Public Report on the conduct of Hon Amos Bangabiti, Hon Maxime Carlot Korman, Mr Irene Bongnaim on the granting of the contract to clean the Bauerfield Airport to FX & BM Cleaning Services - October 25, 1996 - Emalus Campus
Until December 31, 1993, the responsibility for cleaning both the domestic and international terminals of Bauerfield Airport in Port Vila was that of the Department of Civil Aviation. The cost of services was 2.7 million vatu per year. This arrangement ended on December 31, 1993, when the Minister of Transport, Public Works, Civil Aviation, Ports and Marine and Urban Water Supply, Mr Amos Bangabiti, signed a contract with Mr Francois Xavier Chani of FX & BM Cleaning Services. The contract was for 5 years and stipulated an annual amount of 13, 332.800 for the first year, rising to 15,006.184 in the final year of the contract. These amounts represented an increase over the previous cost of cleaning by a multiple of approximately 5. Chani had been and continued to be a significant financial supporter of the UMP political party. In addition to other significant donations, he made financial donations directly to Minister of Transport, Public Works, Civil Aviation, Ports and Marine and Urban Water Supply, Mr Bangabiti (100,000 vatu) shortly before the award of the contract and directly to the First Secretary Mr. Irene Bongnaim (200,000vatu) shortly after the award of the contract.
The Ombudsmanís investigation revealed that proper procedures had not been followed in the awarding of the contract to FX & BM. No tender board was established, contrary to Regulations 361 and 365 of the Finance Act. The period for submission of tenders was shorter than the minimum specified in regulation 363(1) and (3). The contract was not approved by the Attorney General, contrary to Financial Regulation 367(2). The contract was not approved by the council of ministers contrary to Regulation 368(2). There was never sufficient money in the Department of Civil Aviation budget to pay the contract.
After 18 months and payment of 20,207,976 vatu, the 5 year contract was legally terminated by the Government by giving 3 months notice. This termination occurred at the instance of Hon. Willie Jimmy, Minister of Finance on the grounds that the correct procedures for awarding the contract had not been followed.
Subsequent to the cancellation of the contract to FX and BM, steps were taken to find another contractor for cleaning the airport. A tender notice was published and tenders received. Of 4 tenders received, that of FX and BM was the highest at 11,968,000 vatu per year. The lowest bid of 5,700,000 was submitted by Air Vanuatu. Contrary to the recommendation of the Tender Board, Minister Bangabiti recommended to the Council of Ministers that the contract be awarded to FX and BM for 10,000,000 vatu per year. Air Vanuatu was given a contract for a trial period of 3 months only.
On April 9, 1996, then Prime Minister Maxime Carlot Korman wrote to the Minister of Aviation to request that the contract to Air Vanuatu be cancelled and that the contract be awarded to FX and BM. This was done and on July 1, 1996 a second contract was awarded to FX and BM for 10,000,000 vatu.
In relation to the awarding of the second contract to FX and BM, the report reveals several improprieties including:
The Prime Minister Maxime Carlot Korman acted improperly when he instructed the Ministry of Transport to become involved in the termination of the proposed contract for Air Vanuatu.
The Prime Minister knowingly misled the Minister of Civil Aviation when he represented in a letter that he did not know why the first contract to FX and BM had been cancelled.
The Minister of Civil Aviation, Mr Albert Ravutia and The Minister of Transport, Mr Amos Andeng failed to properly carry out their responsibilities as ministers in relation to the awarding of the contract to FX & BM and thereby allowed the contract to be concluded.
∑ That the Attorney General of legal consider legal action to recover losses incurred as a result of the actions of the Prime Minister, Maxime Carlot Korman, the Minister of Civil Aviation Mr Albert Ravutia and the Minister of Transport Mr. Amos Andeng.
∑ That a full Leadership Code Act be introduced
∑ That there be disclosure of political donations received by all political parties
∑ That a limit be imposed on the amount that may be donated to a political party.
Written by Edward R. Hill
UNDP Governance and Accountability Project
© Ombudsman of Vanuatu
Published here by University of the South Pacific, School of Law Web Site - www.vanuatu.usp.ac.fj