Unlawful ‘Righting’ of Bidding ‘Arithmetic’ Errors

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    Twice in as many months a Parliamentary Committee has injected itself (intervened) in bidding wrangles it has zero expertise in to declare there was nothing untoward in the process or there was no wrong-doing in the award of the contract.

    The question is: Are the Parliamentary Committees’ interventions in the munificent service of the public (in which case they are ignorantly performing their oversight function) or are they doing the bidding of one party to the wrangle (in which case they are not performing their oversight function but using the office for personal gain which tantamount to abuse of office)? It is also clear the consultants they engage have little expertise in public procurement matters judging by their blanket erroneous conclusions that give the committees ‘what they want to hear’.

    My initial suspicions about a Parliamentary Committee’s inappropriate interjection in a bidding wrangle (the Mzimba Water Supply Contract tendered by NRWB) that it had zero expertise in have been confirmed by Plem Construction Limited’s 20/06/17 Press Release in The Daily Times detailing obvious anomalies in the handling of and award of the contract and pre-qualified bidders not selected on the basis of ‘the lowest evaluated tender ascertained on the basis of price and non-price criteria specified in the solicitation documents’ resulting in Sawa Group’s tender price of $14.1m being favoured over Plem Construction’s more responsive bid price of $9.9m.

    The Press Release appears to suggest a bidding situation where the tendering committee appears to have purposefully put material non-compliant bid requirements (not disclosed in the bidding/solicitation documents) to disqualify ‘the lowest evaluated tender ascertained on the basis of price and non-price criteria specified in the solicitation documents’ and also suspiciously concocted ‘omitted line items’ to provide a possible mistake in its bid hoping to ‘negotiate’ around the concocted assumed ‘non-material’ non-compliance if it is awarded the contract which, by law, should give rise to “mischief” which “effectively rewards a bidder who has made a mistake in its bid, but then utilizes its non-compliance for the purpose of not honouring a binding ‘lowest evaluated tender price.’

    For the procurement fraternity wallowing in ignorance about public procurement laws (remember the Bible commands us not to condemn those living in darkness but commands them to know the errors of their thinking—well, if it does not it was supposed to), the central reason any ‘righting’ of bid errors (typically arithmetic errors and omissions in submitting documents) in public procurement bids is allowed only in very limited declared situations, explicitly expressed and disclosed in the tender documents is because any ‘righting’ of bid errors is treated as ‘constructive’ negotiation with bidders and Sections 31(15,16) of the public procurement legislation (Public Procurement Act of 2003) prohibits any negotiation(s) whatsoever with bidders as to the substance or prices of their tenders and allows tendering committees to ‘seek only clarifications of tenders, and may not solicit or accept changes in the substance or prices of tenders.’ Section 34(9) explicitly states that ‘any negotiations with a bidder ….. in the award of a contract shall include, and may only concern, discussions of the terms of reference, the methodology, staffing, procuring entity inputs, and special conditions of the contract; and the negotiations shall not – (a) substantially alter the original terms of reference or the terms of the contract so as to affect the quality of the final product, its cost, and the relevance of the initial evaluation….’

    This best practice approach to the treatment of errors in bids seeks to balance the interest in optimal competition and the need to ensure the equal treatment of bidders and transparency in procedures, with a view to avoiding unnecessary bid cancellation due to relatively minor errors with little or no impact on the integrity and fairness of a particular procurement procedure but also to ensure that the tendering process is not undermined by the faulty and unfair conduct of either the owner or the bidders and providing tendering committees with a higher degree of legal certainty when determining, in any case involving errors, whether to reject the bid or not.

    If a tendering committee allows a correction to a tender, it must take care to ensure that this does not result in a breach of the principle of equal treatment and proportionality, which would expose the committee to challenge from other bidders. The tendering committee in this case breached both the principle of equal treatment and proportionality by either asking Sawa Group to provide missing information (substantive enough to create a ‘new tender’) in Sawa Group’s tender or assuming on behalf of Sawa Group the missing information while disqualifying Plem’s tender for not providing an ‘Authorization for Electric Transformation’ and a ‘Specification Sheet under Clause 8007’ and Plem (and the other four tenderers) would be justified in claiming its tender was not given the same treatment as Sawa Group’s tender (which clearly was also deficient, not more—had ‘missing line items’ valued at $4.1m but was not disqualified).

    We either had a very nightmarish bidding situation where Sawa Group submitted a ‘winning’ bid but one which contained errors which inarguably made the bid non-compliant (the non-compliance is so material and substantive as to be a true non-compliance and one not falling within the discretion of the owner to accept non-compliant bids, however that discretion is expressed in the tender documents) but was not declared so and allowed ‘arithmetic error’ corrections to that tender because the tendering committee was ignorant about public procurement laws (several esteemed colleagues have confided in me that tendering committees routinely carry out ‘arithmetic error corrections’, insignificant or substantive, during Technical Evaluations unaware how corrupting to the entire tender process this is and ignorant that they were breaking the tender laws by so doing because the tender laws ‘seek to prevent parties from avoiding performance of bidding/tender promises by dishonest claims of mistake when it proves economically advantageous to do so’) or, just as seriously, the tender process was overtly manipulated not only to favour Sawa Group but also to make sure Sawa Group did not honour its lowest evaluated tender price.

    Contribution by: Chisala, Maxwell L.

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