The above position of the Audit Service is included in a letter from the Auditor General Odysseas Michailidis to the director of the Department of Public Works with a notification to the AKEL MP Irini Charalambidou, who complained about photo offers. At the same time, there is concern about the possible creation of a cartel to share the following projects.
The letter, marked "urgent", indicates that if we take into account the economic operators who may be excluded due to professional misconduct in the Paphos sewerage project, the financial problems faced by most operators and the large number of projects that are announced and will be If announced, then there are two consortia and two bodies that can claim the bids, so the Department is invited to review the quality selection criteria, in order to expand the number of contractors who can submit a bid.
Essentially, the Auditor General suggests that the Department maintain in the bids only the requirement for the category and order of the project.
The letter of the Audit Office, signed by Mr. Andreas Hasapopoulos, lists the ten economic entities / consortia that, as the director of the Public Works Department claimed in a letter, have executed projects worth € 4 million, when they meet the conditions for to bid.
Of the ten, three are excluded due to involvement in the Paphos sewer, while another three are said to not meet some financial conditions to participate, so the criteria are met by only four economic operators, a number that is considered small.
Analyzing the above, the Audit Office notes the following: "If the economic operators who may be excluded due to professional misconduct during the execution of works of the Paphos Sewerage Council are not taken into account (the names of three companies are listed) there are only four economic operators left the criteria, which are named by the Auditor General ".
The Auditor General notes that due to the financial problems faced by most economic operators, three of the ten (named) were found not to meet the requirements of financial and financial adequacy for the liquidity ratio and / or the interest rate payable ratio. (These are additional financial guarantees that bidders must meet to be eligible to bid, but due to financial constraints most are left out of the criteria they can meet through banks, which however do not facilitate contractors when they do not submit offer after they will be excluded).
The Auditor General also mentions that financial problems are facing two other companies (which could submit a bid) which he names, and explains:
"Those of the above companies that do not have outstanding debts to the State and will be able to participate in the tender, will have to, if they do not meet the conditions of financial and financial adequacy, submit a working capital commitment of 20% of the annual value of the project in case award of the contract, in addition to the faithful performance of the guarantee ".
However, it is well known, the Auditor General continues, that contrary to past practices, today financial institutions handle the issuance of such commitments in a similar way that they apply to bank guarantees. This means that economic operators who are required to make such a commitment often have great difficulty in securing it, which discourages them from participating in public tenders.
Auditor Concern for Contractor Difficulties
The Auditor General states that his Office is deeply concerned about the financial difficulties faced by economic operators (contractors) but also the number of projects that follow and adds: We would expect the same to happen with your Department, as the conditions are met, or for reduced participation or for pre-arrangement of the bidders (for sharing the projects between them -the few- that meet the participation criteria).
The Auditor General concludes: "Taking into account the above, as well as the prevailing economic conditions, we are of the opinion that, for the purposes of wide participation in the said tender, but also taking into account the tenders that have already been announced and those that are expected to should be immediately reviewed, you should immediately reconsider the quality selection criteria you set in the form of additional conditions of participation, financial and financial adequacy and technical and professional capacity, retaining, where this is absolutely necessary due to the very large size or special technical , only the requirement for the Category and Order of the project ".
What did the Minister answer?
The cartel does not exist in Public Works, said the Minister of Transport, Communications and Works Marios Dimitriadis, in his statements after the end of the session of the Parliamentary Committee on Transport and Works.
Asked to comment on the publication of "Phileleftheros" entitled "New cartel in public works", according to which refers to the tender for the renovation of Pernera Avenue in Paralimni, Mr. Dimitriadis said that this issue has been discussed again.
The terms of the competition are terms that the Public Works have for similar projects, for all similar projects, that is, no special conditions have been made for this project, so that they can photograph anyone, he said.
"These are the usual conditions set by the Public Works to ensure that a project will be done with the necessary quality, because to do a project, especially when we are talking about projects over 5 million euros, there are some criteria to ensure that it who will build it will be able to complete the project. In this case, in fact, a survey was conducted to see how many meet these criteria. "These are 11 companies that meet the criteria and based on that, it was judged that the competition between them would be satisfactory, in order for the public to ensure the appropriate prices", he added.
Mr. Dimitriadis stated that a letter had been sent by the Auditor General.
"I asked the Public Works to come to an agreement with the Auditor General. The Auditor General's view was that the criteria should be much more relaxed. There is the opinion of the Department which sets or believes that there should be specific criteria. An agreement has been reached with the Office of the Auditor General and we believe we will reach a good result that combines both. I do not understand how the Department of Public Works is exposed, or how the Minister is exposed, or how a cartel is created. Cartel does not exist in Public Works. "Anyone who has any information on this matter should ask him to submit it to the Auditor General, but also to the Police", he concluded.
Source: Liberal