CCTV management contract ‘circumvented’ the rules

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    A project management contract for the government’s public closed-circuit television monitoring system effectively “circumvented” tendering rules, according to auditors who recently reviewed the CCTV project.  

    Although the bidding process for the $1.9 million contract was said to be “reasonably OK”, a number of issues with the deal were identified by the auditor general’s office in a report issued this week, including government’s hiring of a consulting firm to shepherd the installation of the CCTV. 

    In June 2010, the government Portfolio of Internal and External Affairs entered into three separate contracts, all with a company called Security Risk Management Consultants, Inc. based in Columbus, Ohio. Each separate contract was valued at $48,500.  

    The financial regulations of Cayman’s Public Management and Finance Law require entities to use a public tendering process for all contracts greater than $50,000 – although the government’s Central Tenders Committee typically does not become involved unless the contract to be bid is worth $250,000 or more.  

    No public tendering process was used in awarding the three contracts, Auditor General Alastair Swarbrick said.  

    “While the issuance of three separate contracts under $50,000 is technically in accordance with the financial regulations, it is clear in this case that the contracting process was structured to avoid the intent of the financial regulations,” Mr. Swarbrick’s report read.  

    Moreover, Audit Manager Martin Ruben said he could find no evidence there was any real difference between the three separate CI$48,500 contracts that were awarded.  

    “It became clear that it was really more or less one contract,” Mr. Ruben said. “By issuing three contracts for just less than $50,000, it was our belief that they circumvented, is you wish, the tendering rules specified in the financial regulations.”  

    Another contract amendment worth $30,000 bumped the total cost of project management to $175,000, according to auditors. “I understand the auditor general’s comments and opinion, certainly [circumventing the law] was not our intention,” said Eric Bush, deputy chief officer of the Portfolio of Internal and External Affairs. “We do have reasons why we went down that route, however the place to explain that is in the Public Accounts Committee.”  

     

    Contract delay 

    Following the Central Tenders Committee’s award of the initial CCTV project contract – valued in the beginning at about $1.4 million – there was a six-week delay in the final approval and implementation of the contract.  

    That delay was caused by Cayman Islands Cabinet members, auditors said.  

    According to Mr. Swarbrick, the Cabinet-ordered delay revolved around “value for money” issues with the winning bidder, The Security Centre.  

    “There was another bid that was lower, but didn’t meet the criteria,” Mr. Swarbrick said, adding that the bid was considered but just weren’t awarded as many points in the tendering process.  

    “We believe that Cabinet’s intervention in this important administrative process goes against the principles of good procurement practice,” the audit report read.  

    However, the report also points out that change orders were made to the contract which bumped its total value to $1.95 million, and that an advance payment of $344,341 was made.  

    The advance payment represented about one-quarter of the value of the initial CCTV contract with no explanation for why that advance was required.  

    Mr. Swarbrick said normally auditors would expect to see the successful bidder on any government contract to have the funding in place to carry it through without advance payments from government.  

    “Advance payments should be used as rarely as possible,” he said, adding that change orders on contracts should also be minimised. In this case the change orders added nearly $575,000 to the value of the CCTV contract.  

    Mr. Bush, responding on behalf of government, said that there are no clear guidelines regarding how pre-payments or change orders should be made. In the case of the CCTV project, all competing bidders notified the government that they would require an advance payment, he said.  

     

    Project delays 

    It was first estimated that the public CCTV cameras would be up and running by December 2010. The cameras are now expected to be installed by this month or next.  

    The delays between then and now were “avoidable”, according to auditors.  

    “The government did not do enough to ensure it was completed in a timely fashion, recognising the importance of this programme to the objectives it was trying to achieve,” auditors said.  

    The CCTV system was touted as an important tool in reducing crime on Grand Cayman.  

    As early as June 2010, the CCTV project team identified the need for legal changes that would allow the government to use power lines owned by Caribbean Utilities Company to transmit CCTV images.  

    However, auditors said it was only in May 2011 that legislation was finally passed to make the change and let government access CUC cables.  

    Auditors advised government to review the circumstances that led to this further delay. 

    CCTV

    A workman installs a CCTV camera pod at the junction of Walkers Road and Academy Way. – Photo: Jewel Levy
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    2 COMMENTS

    1. The CCTV system was touted as an important tool in reducing crime on Grand Cayman. It is also touted by the British interest as an important tool to sustain colonial power over the Cayman Island’s inhabitants. But they won’t tell you that, because the more people that are ignorant as to what the left hand is doing over the right hand, is the more these lords sustain their rule.

      Our constitution is just to make us believe that we have absolute democracy here.

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