STATEMENT DELIVERED BY THE HON MINISTER OF TRANSPORT AND AVIATION TO PARLIAMENT ON WEDNESDAY 22ND JULY 2015 ON THE PROCUREMENT OF 100 NEW BUSES BY THE GOVERNMENT OF SIERRA LEONE THROUGH THE MINISTRY OF FINANCE AND ECONOMIC DEVELOPMENT AND THE MINISTRY OF TRANSPORT AND AVIATION
In late 2013, His Excellency the President raised concern over the long lines of people waiting to board transport to and from work on a daily basis and instructed me to address the problem within the shortest possible time.
Following this instruction, I held discussions with the Hon. Minister of Finance and Economic Development requesting for provisions of funds for procurement of 100 buses to help solve the acute transportation problem in the country. Unfortunately there were no provisions in the 2014 budget to accommodate the procurement of 100 buses; in short we did not have the money.
SEARCH FOR EXTERNAL FUNDING
It was therefore agreed that we look for alternative sources of funding. This involved a lot of time and painstaking engagements. During the search for funds we received an offer from Poly Technology Group in China through their Local Representative, Mr. Mamoud Khadi for the provision of a loan of 12 Million Dollars to purchase 100 buses that would include the following:
(a) Cost of the 100 Buses
(b) Shipping freight and Insurance
(c) Export Credit Insurance costs
(d) Interest amount calculated at 6 % per annum of Loan amount for 2 years
(e) Two Mobile workshops
(f) 3 Service 4WD vehicles
(g) 2 years worth of spare parts
(h) Various machinery and equipments to replace the old and out dated colonial machinery at the SLRTC
(i) Training and technical support to SLRTC
(j) Overseas and domestic travel expenses for delegation from Sierra Leone to China and back
(k) Chinese Technical team attachment to SLRTC
(l) Local Agency Fees and charges
Package and Technical Specifications
All of the above represented a package and the proposal was submitted to the Ministry of Finance and Economic Development which accepted it as a loan package to be negotiated by the Public Debt Division of that Ministry which by statute negotiates all loan agreements and terms and conditions of behalf of the Government of Sierra Leone.
For the vehicle specifications, my ministry utilized the technical expertise of the engineers of the Sierra Leone Road Transport Corporation (SLRTC) and Sierra Leone Roads Safety Authority who provided detailed specifications. On the basis of these specifications, the prices were determined. In other words, it was based on specifications that the costs were arrived at.
It was advised that the buses were to be designed and manufactured according to specifications to befit the terrain and weather conditions of Sierra Leone, including other considerations provided by the Ministry of Transport and Aviation (MTA) and the Sierra Leone Road Transport Corporation (SLRTC). The buses were not to be picked up form the shelf of already manufactured assembly of buses.
For this purpose, a delegation led by the Ministry of Finance, including the Minister of Transport and Aviation, (both Political heads) the Director of Public Debt, Ministry of Finance, The General Manager, SLRTC, (the 2 technical experts) and the then Permanent Secretary, travelled to Beijing, China.
As I said earlier, all loans to the government of Sierra Leone are by statute negotiated by the Ministry of Finance, through its Public Debt Directorate. In this case both the General Manager, Sierra Leone Road Transport Corporation (SLRTC) and Ministry of Finance and Economic Development (MoFED) negotiated the interest rates and the repayment terms based on the customized specifications provided by the SLRTC and SLRSA Transport Engineer.
Concurrence from MOFED, Attorney General’s Office, National Public Procurement Authority and Ministry of Transport and Aviation Procurement Committee
On 7th April, 2014 after receiving concurrence from the Ministry of Finance (which I now read) and subsequent discussions with Poly Technology in China, a Loan agreement was drafted between the Ministry of Transport and Aviation (SLRTC being the recipient of the buses) and Poly Technology, China.
The draft loan agreement was then submitted to the Attorney General and Minister of Justice who gave his approval for the signing of the agreement by letter dated 17th April, 2014 which I now read.
In the same vein and as a result of the urgency of the situation and the conditionalities of the providers of the loan that the buses must be supplied by their preferred supplier, Zongtong Bus Company, China the Ministry of Transport and Aviation sought approval from the National Public Procurement Authority (NPPA) for sole sourcing which the NPPA granted based on conditions that were followed by the SLRTC, by letter dated 26th March 2014.
In addition to the above, the Ministry of Finance in giving it’s approval also gave conditions that the loan must be repaid by the Sierra Leone Road Transport Corporation and that a Steering Committee including representatives from the Ministry of Finance, Ministry of Transport and Aviation, the National Commission for Privatization (NCP), the Accountant General Department and the Sierra Leone Road Transport Corporation must be set up to supervise the operations of the buses and pay all monies to an Escrow Account which must be utilized to repay the loan.
SECURING GOVERNMENT INTEREST/INVESTMENT
In the agreement, the Ministry of Transport and Aviation ensured the inclusion of guarantees and protections in the form of certain provisions that secured the interest of government and ensure fiscal discipline. These include, but are not limited to provision of advance payment guarantee and a one year warranty period covering all repairs.
SERVICE TO THE NATION
In all of the above, we did our best as a government to serve our people and our nation:
(i) His Excellency the President provided the Political leadership by instructing that the problem of public transport be addressed; he demanded that the long queues of Sierra Leoneans waiting for public transport should be a thing of the past;
(ii) Following the acquisition of the buses, the Street queues have largely disappeared;
(iii) The Ministry of Transport and Aviation followed all procurement rules and procedures to the letter including No Objection from the Ministry of Finance and Economic Development, the Attorney General’s and Minister of Justice Office, National Public Procurement Authority and the Ministry of Transport and Aviation Procurement Committee of which the Minister is not a member;
(iv) The Special order(customized details) of the buses were supplied by the technical experts; Engineers of SLRSA and SLRTC on the basis of which the buses were priced;
(v) In the agreement, we included certain provisions that secured the interest of government and ensured fiscal discipline and value for money;
(vi) For the first time in the history of Sierra Leone Road Transport Corporation (SLRTC), all monies collected from ticket sales will be paid into an Escrow account designated and controlled by the Ministry of Finance and Economic Development.
Mr. Speaker, Hon. Members, certain persons have circulated bus prices on pieces of paper without letterheads for buses that were not ordered by the Sierra Leone Road Transport Corporation (SLRTC). The SLRTC did not order any of the buses on that sheet of paper which are 28, 44 and 31 seaters with prices attached to them.
The buses purchased by SLRTC are 20, 47 and 30 seaters and were made based on SLRTC specifications.
See Zhong Tong Bus Manufacturers certificates reproduced hereunder.
Mr. Speaker, Hon Members, in all of the above I think that we at the Ministry of Transport and Aviation did our best and followed the law and endeavored to serve our beloved country Sierra Leone. I am heartened by the public acclamation irrespective of the few challenges. Our people are aware, they are asking questions and we are ready to provide answers to those constructive inquiries.
Thank you for your attention