ACC orders termination of contract to privatise flat maintenance

Anti-Corruption Commission (ACC) has ordered Malé City Council to terminate its MVR30 million agreement with Village Construction to maintain flats in Malé and Vilimalé.

ACC notified Malé City Council yesterday, to end the project and hand over the task of assigning the project to Tender Evaluation Board of Ministry of Finance.

ACC has said that according to regulations, any project worth more than MVR1.5 million must be submitted to Finance Ministry’s Tender Evaluation Board before it is assigned to a party.

ACC’s investigations have revealed that this project awarded by City Council to Village Construction is worth more than MVR1.5 million, but was not submitted to the Tender Evaluation Board.

Village Construction was assigned to provide security and other maintenance services to flats last April, for a period of 10 years. The agreement states that MVR3.6 must be paid to the company during the first year, and MVR3 million must be paid every remaining year. The contract is worth a total of MVR30.6 million.

According to ACC, maintenance of flats constructed by the government cannot be assigned to a private company as certain rules have to be followed in the process of making such assignments.

Moreover, Housing Ministry’s documents show that construction is not allowed in the open space inside government flat buildings; however, this was not included in the agreement.

Also, the company had not included any time period in its bid proposal, but the project was awarded for ten years.

ACC further said that the money was not included in the budget, and City Council had requested Finance Ministry to change the budget code, however this had not been done.

While funds as required the payment voucher were not available, the payment of MVR500,000 to Village Construction was made by debiting the item, which is a violation of the law.

Existing regulations state that the most relevant item in the budget should be used to make payments, and the payments do not exceed the assigned budget. It is also states that no payment which is not included in the budget should be made, without first obtaining written approval from Finance Ministry.

“Based on our findings so far, it is likely that this project involves corruption and was assigned to benefit a certain group of people. We are thus conducting an investigation,” reads ACC’s statement.

Residents of the flats have earlier protested against City Council’s privatisation of maintenance of flats.