OCG restructures, beefs up construction inspectorate

Avia Collinder, Gleaner Writer

With more than $3.1 billion in cost overruns on government construction projects in 2008 and concern over the award of jobs to unregistered contractors, which it says continues to be a problem, the Office of the Contractor General (OCG) is recruiting additional inspectors in an effort to enhance its oversight and weed out corruption.

The OCG, during the summer, placed a series of advertisements in the local press seeking to hire inspectors who Contractor General Greg Christie said will help bring greater accountability to the management of state contracts. The OCG is also bringing in another group of inspectors for non-construction contracts, licences and permits, as part of the major restructuring of this oversight body.

In a response to Business on the issue of human resources needed for the construction sector, Greg Christie stated, "If, as a country, we are to ensure probity, transparency, accountability, competition and value for money (for the Jamaican taxpayer) in the Government procurement and contracting processes, the enhanced scrutiny of the award and implementation of all Government of Jamaica contracts should be everyone's goal and business."

The OCG's latest report, for 2009, has not yet been tabled in Parliament, so it is not publicly available.

But two years ago, the OCG reported overruns of up to $3.14 billion on construction contracts monitored by the agency, representing approximately 16 per cent of the $19.47 billion in construction contracts awarded in 2008.

Construction contracts during that review period accounted for 46 per cent of $42.23 billion on contracts for all goods and services.

Under the government's procurement procedures, since September 2008, contracts under $10 million do not require endorsement by the National Contracts Commission (NCC), an agency separate from the OCG.

Irregular practices

Critics often complain that big government contracts are sometimes broken into small parcels to avoid review and endorsement by the NCC and, hopefully, oversight by the OCG.

Sometimes, these contracts are channelled to unregistered contractors, a scheme Christie said his office has spent much time attempting to weed out. High on the OCG's agenda, too, has been the removal of non-performing contractors from the NCC's Register of Approved Contractors.

In 2008, works contracts of between $250,000 to $4 million, with a cumulative value of $249.3 million, were awarded to contractors who were not registered with the NCC.

Construction-sector problems chronicled in the OCG's 2008 Annual Report include burgeoning cost overruns in the implementation of government works projects resulting from "late or inadequate procurement planning, the lack of proper project management, a paucity of on-site supervision and insufficient financial resources on the part of either or both the contractor and the Government procuring entity".

These contributed to the hefty cost overruns.

The OCG noted that addressing this continuing problem in a comprehensive way would demand the "aggressive and proactive efforts of all stakeholders who play a role in ultimately facilitating the administration and execution of Govern-ment contracts".

Non-performing contractors

With regards to the removal of non-performing contractors from the NCC's Register of Approved Contractors, the 2008 report indi-cated that this was a big sore which needs to be addressed. "Another significant source of concern for the OCG is the continuing problem that is posed by the unsatisfactory performance of a number of contractors who are registered in the works categories of the NCC's Register of Contractors, but who, notwithstanding, continue to benefit from Government contract awards."

Closely aligned to this problem, the report said, is the associated issue of the award of Government contracts to contractors who are not registered at all with the NCC.

The practice, the report said, continues to be a pervasive one which is undermining the credibility and strength of the Public Sector procurement system.

During the 2008 calendar year, the NCC endorsed or recommended for award, a total of 414 works contracts in the amount of J$19.4 billion in various works categories. Relative to the number of contracts that were endorsed by the NCC, the construction division was able to monitor the implementation of a total of 235 contracts, in both their pre-contract and post-contract phases.

The number of contracts monitored for the 2008 calendar year represents approximately 56.76 per cent of the total number of contracts that were endorsed by the NCC.

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