HRDC exposes more procurement rot at MERA:  Furnishes ACB with documents to facilitateprobe

The veil is certainly off the face of the Malawi Energy Regulatory Authority (MERA) and it is now time for the poor taxpayers to see the plunder that has been obtaining at their organization.

MERA is mandated by Parliament to regulate the energy sector in Malawi in a fair, transparent, efficient and cost effective manner for the benefit of the consumers and operators.

But if the contents of letter of the Human Rights Defenders Coalition (HRDC) to the Anti-Corruption Bureau (ACB) is anything to go by, you will be left with no other option than to suspect that MERA has been operating as a ‘cash-cow’ for the chosen few politically-connected souls.

HRDC has uncovered underhand dealings into MERA’s procurement of electronic fuel level sensors for fuel tanker trucks and electronic fuel level sensors for depot fuel storage tanks.

The sensors were meant to check the siphoning of fuel from tanker trucks and depots.

The suspected corrupt practice has prompted HRDC to write ACB, asking the graft-busting body to commence the investigations to the procurement as soon as possible and that the anti-corruption body should update the nation when the investigations have started.

According to the coalition, MERA invited restricted tendering for 1, 447 sensors for tanker trucks and 135 sensors for depot fuel storage tanks although, as a regulator, MERA does not own trucks or fuel depots.

“We do not know how the companies that participated in this restricted tendering were identified. One would suppose that probably these companies had prior expertise in similar work. On 30th November 2017, MERA opened bids with the following results: MARS International/Mike Appeal JV – MK2,396,000,000.00, Lamat Globe Limited -MK39,000,000.00, Linearity Systems      – MK1,247,240,000.00, North End Motors – MK800,716,114.75, VEGA Investments – USD3,656,742.80, E Trading Incorporation – MK1,104,690,135.95, City Motors/Tracker Limited – MK4,494,450,587.50, Delta Energy Gas – USD  965,020.00, CEE-Elo Petroleum Energy – MK 318,863,476.62 and Pulsit Electronics Limited – MK910,573,239.00,” says the HRDC letter.

The coalition’s chairperson Gift Trapence has signed the letter alongside his executive members.

Trapence says after the opening of the bids, MERA indicated that there was need to include additional specifications, which required that the companies should submit fresh bids.

“For purposes of this letter, we will only highlight the bids that met technical specifications and their new prices: E Trading Incorporation – MK1,002,190,500.00, Pulsit Electronics – MK910,573,239.00, CEE-ELO Petroleum      – MK348,859,606.23, MAS/Mike Appeal JV -MK3,254,492,776.62 and City Motors/Tracker at MK4,654,175,000.00. MERA then went ahead to award the contract to MAS International/Mike Appeal Gato Joint Venture whose second bid had increased by MK800 million. On 19th March 2018, MERA then wrote the Public Procurement and Disposal Authority (PPDAA) seeking a “no objection” to proceed awarding the contract,” alleges the letter.

HRDC adds that on 3rd April 2018, PPDAA responded to MERA indicating that they were withholding their “no objection” in terms of section 44(7) of the PPDA Act as MAS International was not the lowest evaluated bidder.

PPDA also advised MERA to engage the Ministry of Justice and Constitutional Affairs to help draft a proper contract to protect Government from paying unnecessary additional costs.

However, instead of following the advice, on 8th May 2018, MERA wrote back to PPDA appealing against the decision.

On 22nd June 2018, PPDA wrote to MERA maintaining their position that the contract could not be awarded to MAS International as doing so would not promote the principle of value for money. PPDA further advised MERA to re –evaluate the bids and award the contract to the most economically advantageous bidder.

On 28th June 2018, MERA wrote a second appeal to PPDA clarifying their choice of MAS International. Among the reasons given was that the preferred bidder had a proven track record of involvement in similar service.

“Based on this clarification and in terms of section 51 of the PPD Act, PPDA granted the no objection. Our preliminary investigations, however, indicate that MAS International has no proven track record of involvement in similar service. We wonder why MERA had to lie to PPDA. Furthermore it is our understanding that these electronic sensors were going to be installed on private trucks and private fuel depots. We wonder why MERA was being involved in private enterprise.

“At the very least and being generous, we think this is micromanagement of the fuel industry. Our preliminary investigations indicate that out of the 1447 trucks, MAS International had only installed sensors on less than 20 trucks,” states HRDC in the letter.

The coalition has supplied several documents to ACB to substantiate the claim and enable the graft buster to use in investigating the matter.

MERA chief executive officer Collins Magalasi said he would not comment on matters that are in the hands of ACB.

The energy regulatory board was recently dissolved by President Lazarus Chakwera. It was being chaired by Bishop Joseph Bvumbwe.

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