PPDA orders RBM to retender ICT bids

Reserve Bank of Malawi

The Public Procurement and Disposal of Assets Authority (PPDA) has ordered the Reserve Bank of Malawi (RBM) to retender the supply of ICT equipment to the Central Bank after it found errors in the bidding process which was awarded to Mitra Systems Limited.

The decision was arrived at after Sparc Systems Limited lodged an appeal to the Director General of PPDA following a series of mistakes in the bidding process, which, amongst others, saw the Central Bank awarding the contract to the alleged successful bidder despite existing for only two years when one of the bidding requirements was that the firm should have operated for a minimum of five years.

According to the documents made available to this publication, RBM invited bids from eligible bidders to tender for supply and delivery of ICT Hardware for Flexicube Upgrade reference number RMB/ICT/007/02, and Hardware for Automated Transfer System (ATS) reference number RMB/ICT/008/20 from which three companies responded to both tenders.

The Central Bank announced that Mitra Systems was the successful bidders as they were the lowest evaluated.

This prompted Sparc Systems, the Malawi’ leading ICT Service providers, to seek permission to the Head of Procuring entity to provide access to the entire record of the procurement proceedings, including evaluation report of bid evaluators, minutes of the meetings of RBM’s Internal Procurement and Disposal Committee and all correspondence with the PPDA, a request which was turned down by the respondents who said they were not allowed to disclose information relating to the examination, clarification, evaluation, comparisons of bids and recommendations and approvals made on particular tender to bidders or any person.

Sparc appealed to the PPDA to which the bank responded that Sparc Systems Limited were not successful in the bid for failure to submit Manufacturer’s Authorization from Dell as per requirement as presented in section 3 of the bidding document.

Furthermore, the bank alleged that Sparc Systems Limited proposed to supply and deliver equipment manufactured by IBM, Dell and Kemp but failed to submit Manufacturer Authorization from Kemp.

However, during the review proceeding that further involved free mobile roulette, Sparc Systems Limited showed that it had matched the requirements to all the criteria including the Manufacturer Authorizations and technical details as requested in the bidding document, refuting RBM’s accusations that the company did not qualify at eligibility stage.

Sparc also refuted RBM claim that it had indicated only one traceable reference in the bidding document which RBM showed as a basis for disqualification.

The company then accused RBM of not following the procedure at bid opening by failing to go through the bid opening checklist to verify if the requested information was available in the bids, a normal trend that ensures that the availability of Manufacturer’ Authorization, bid security and bid validity period are checked and verified in the presence of representatives of bidders.

According to Sparc Systems Limited, even in the unlikely event that a document was missing, RBM had the right to ask for it according to section 31 of the tender document which gave powers to the central bank to ask for such documents for any responsive bid.

The company then accused the Central Bank of unfair treatment, breaching section 30 of the PPD Act of 2017 which requires that all public procurement proceedings be conducted in a manner which promotes transparency, accountability, non-discrimination, fairness, open completion, anonymity, economy, efficiency and responsiveness to modern information and communications technology.

“The decision to recommend Mitra Systems for the award violated Regulation 133 of the Public Procurement Regulations. This Regulation provides that only those who qualify may be awarded the contract. Mitra Systems had only two years post registration therefore did not qualify as per the requirement of 5 years of experience,” reads part of the submission from Sparc Systems Limited to PPDA.

In its determination after hearing from both sides, PPDA Review Committee has faulted the bank and ordered it to retender the supply and delivery of ATS Procurement reference number RMB/ICT/008/20 of Lot 1 and 2, and to retender the supply and delivery of Flexicube Procurement reference number RMB/ICT/007/20.

The Bank has also been advised to engage independent evaluators for the procurement, with the tender be published at a reduced period of 21 days.

PPDA has also advised all bidders who participated in the initial bids to bid again in the second bidding.

The two tenders at RBM came into the front news in November last year when Human Rights Defenders Coalition wrote the Anti-Corruption Bureau (ACB) to investigate possible corruption in the matter.

According to HRDC Chairperson, Gift Trapence, his organisation had received allegations that three companies bid for the procurement of ATS equipment: namely, Mitra K1,068,732,141.30; Sparc Systems Ltd K989,865,480.39 and Move Secure K 874,980,291.80.

He added that bids for the procurement of ICT hardware for Flexicube upgrade were as follows: Oranux K1, 049,631,250.82; Sparc System Ltd K 976,851,674.00; and Mitra Systems K 757,133,881.49.

“It is further alleged that Sparc Systems came first in this evaluation. It is, however, alleged that RBM has a policy that states that two big contracts cannot be given to one company and thus to hedge the risk, the evaluation team recommended splitting the awards.

“It is further alleged that this resolution was made even though Mitra has been in operation for less than three years and therefore does not have enough experience,” Trapence said in the letter.