DHA Lahore violates PPR-2004: TI Pakistan

KARACHI (April 15, 2011) : Public Procurement Regulatory Authority (PPRA) has asked for a comprehensive report/comment from the Defence Housing Authority, Lahore on the complaint of Transparency International Pakistan regarding violation of Public Procurement Rules (PPR)- 2004 in the invitation of pre-qualification of insurance companies.

Transparency International Pakistan Chairman Syed Adil Gilani in his letter sent to Brigadier Muhammad Aslam Rana, Administrator, DHA, Lahore has pointed out the following violations which have been noted in the procurement notice.

— DHA is not providing set of pre-qualification documents as required under Rule 16.

— DHA cannot condition that “the decision made by the Authority will be final and will not be subject to challenge before any court of law,” under Rule 48. Further this condition is against the fundamental rights provided in the constitution of Pakistan. – The condition that the “insurance company must have seven identified hospitals on its panel” is against Rule 32. Discriminatory and difficult conditions. This violation gives the impression that one specific company currently has all these seven hospitals on its panel, and on this ground all other insurance companies may be eliminated at this stage. DHA may make a condition that the seven identified hospitals will have to be added to the panel by the insurance company who is awarded the contract, so that everyone has the option to take them on board. Public Procurement Rules – 2004 have eliminated all discretion in procurement process, and Rule 16 requires you to prepare a set of pre-qualification documents, and provide detailed evaluation criteria to applicants, which is not being given to applicants on this project.

— The evaluation criteria shall also include a detailed criterion on how each mark will be awarded in each category, which makes this discretion free. Bidders must be informed how the scoring will be done for each category and what is the passing score in each category and overall score.

— The DHA has been reminded that PPR – 2004 is applicable on DHA since June 2004, and the Ministry of Defence has taken serious note of violations, as has been reported in the newspapers.

— The Adjutant General of Pakistan Army in his letter of February 15, 2011, has written to DHA regarding the implementation of PPRA rules. Public Accounts Committee (PAC) in its letter of June 21, 2010 had made similar observations. Transparency International Pakistan reiterated that PPRA rules must be observed in their real perspective in letter and spirit while making procurements. Violations of these rules will be viewed seriously and head of department/organisation will be held responsible for the same.

— Transparency International Pakistan has forwarded the above information for the purpose of avoiding the mis-procurement charge under Rule 50, and to re-advertise this pre-qualification notice under the prescribed procedures.

— Transparency International Pakistan has also referred to the Supreme Court of Pakistan order given on April 28, 2010 in case of disputed award of multi-billion dollar LNG contract to GDF-Suez, in which it had announced: “here we may observe that it is the duty of the court to ensure that the Public Procurement Regulatory Authority Ordinance 2002 read with the Public Procurement Rules – 2004 are adhered strictly to exhibit transparency.”

Copies of the letter have also been sent to Public Accounts Committee, Chief of Army Staff, Auditor General of Pakistan, Secretary, Ministry of Defence, Chairman, National Accountability Bureau, and Managing Director PPRA.