Public entities are recommending errant contractors for blacklisting more than ever

  • Amid growing media and public scrutiny, officials say the government agencies can no longer overlook contractors’ shortcomings

Mar 12, 2019-

The Public Procurement Monitoring Office has blacklisted 13 errant firms—contractors and suppliers—for occupying a large number of projects without completing them on time since January 17. The number of blacklisted firms has been on the rise in the last three years.

PPMO officials said that this rise is a manifestation of the growing anomalies in the construction sector.

Under the Public Procurement Act, a blacklisted firm cannot take part in public procurement from one to three years depending on the seriousness of the offence.  

As of February 23, the PPMO had initiated the process of blacklisting 32 firms. Of them, seven firms have been suspended following court orders. In the fiscal year 2017-18, 52 firms were blacklisted. The number was 47 in the previous fiscal year.

“The number of blacklisted firms has been growing lately because public entities have been recommending erring firms for blacklisting more than before,” said Yagyaraj Koirala, spokesperson for the PPMO. “In the past, there was a common tendency among public entities to overlook the contractor’s shortcomings.”

Most of the firms that are blacklisted work in road and bridge projects, several of them owned by politically influential people.  

The projects handled by Pappu Construction owned by suspended lawmaker Hari Narayan Rauniyar; those handled by Shailung Construction owned by Sharada Prasad Adhikari, who is landlord of ruling Nepal Communist Party Co-chair Pushpa Kamal Dahal; those awarded to Kalika Construction owned by former minister Bikram Pandey, among others, made national headlines for either project delays or inferior works. Corruption cases were filed against Rauniyar and Pandey for substandard works in a bridge and an irrigation project respectively.

Police also arrested some contractors in April last year as the government mounted pressure on unruly contractors. But the effort was discontinued due to strong protest and lobbying from the contractors.

Earlier, the Commission for Investigation of Abuse of Authority had raised concerns regarding anomalies in several construction projects and sent a dossier of suggestions to the government entities to ensure that the projects are completed on time.

According to Koirala, these factors encouraged the public entities to recommend the PPMO for blacklisting a number of firms.

Amid public scrutiny, the PPMO has barred the infamous Pappu Construction from taking additional contracts. As a result, Pappu could not get the contract of reconstructing Nepal Rastra Bank building at Baluwatar, Kathmandu, despite emerging first in the evaluation process.

Blacklisted firms

Fiscal year                              Number

2013-14                                   30       

2014-15                                   36

2015-16                                   18

2016-17                                   47

2017-18                                   52

2018-19*                                 32

*Until Feb 23, 2019

Souce: Public Procurement Monitoring Office


Published: 12-03-2019 08:17

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