Published On: Fri, Jan 25th, 2013

Proliferation on government contracts after 10-10-‘10

WILLEMSTAD – The inquiry from government accountants Soab as ordered by Minister of Finance, José Jardim (recommended by the PAR at the time) revealed that after the autonomous status on 10-10-’10, 133 contracts were concluded for a total amount 1,478,701 guilders per month. A specification of these contracts shows to which posts or sectors they belong. The inquiry by Soab was conducted among other things to support the Shared Service Organization (SSO), which is part of the Ministry of Administration, Planning and Service (BPD).

Rent contracts

From the various ministries Soab received 46 rent contract in total of which the rent amounted to 10,215,097 guilders per year. Soab found several contracts that couldn’t be terminated prematurely and which include clauses for sanctions. “Apart from these rent contracts the financial administration revealed monthly payments for the rent of several other buildings; however, we didn’t receive the relevant contracts. The costs of these contracts amount to 613,506 guilders per month. With the payments for which we didn’t receive any contract the total rent per year is estimated at 17,577,169 guilders”, according to Soab.

Leased cars

The costs for leased cars are built up from 22 lease contracts for 33 vehicles in total, divided over several ministries. “These represent an amount of 56,295 guilders per month and 675,540 guilders per year. “We were unable to discover if all contracts or quotations sent to us by the ministries actually led to the leasing of these vehicles. On the one hand we couldn’t find any payment in the financial administration for several contracts, and on the other hand we found payments for leased cars for which we didn’t receive any contracts. Vehicles were also leased without contract and payment, for example with the Ministry of BPD”, Soab reported. The conclusion is that based on the current lease contracts 675,540 guilders per year is owed to supplier, while 809,100 guilders is estimated. This amount will most likely not be sufficient, considering the amounts owed for the vehicles already in use without contract of which the payment hasn’t been booked. One could consider not signing the pending (unsigned) contracts, according to Soab.

Contracts for legal assistance

Soab received 5 contracts for legal assistance, divided over the ministries BPD, AZ, OWCS and VVRP. These contracts cost 110,400 guilders per month and 1,324,800 guilders per year. Also these contracts were concluded after 10-10-’10 with a term of validity up to 2013-2014. “Some contracts are for all legal service required for aforementioned ministries, including ‘legal assistance to the minister in question with a relevant government company or institution’. These contracts include a stipulation that with early termination, excluding non-observance by the attorney’s office, meaning the termination costs equal an amount for twelve months.” Soab therefore concludes these contracts cannot be terminated in the short term; thus no possibility to save in costs.

Consultancy

Thirty-two consultancy contracts were concluded for a total amount of 732,265 guilders per month, of which several were concluded as from October 2010. “One contract of 1925 guilders per month couldn’t be found in the financial administration. The consultancy costs mainly regard IT-contracts with the government nv’s. “Most of them expired around December and Soab believes an economy is possible providing the service is no longer necessary.

Security

Fifty contracts were concluded for other services amounting to 414,773 guilders per month, or 4,977,277 per year. “The majority regards security contracts, of which most were concluded after October 2010. Information from the Ministry of BPD shows that a contract with Speedy Security (of which former minister of Finance, George ‘Jorge’ Jamaloodin (MFK), had been the director before he became minister) to guard the building of the Ministry of Finance, was terminated in writing per May 31st 2013. After this date it will yield a saving of 42,250 guilders per month and 507,000 guilders per year.” Soab suggests checking if other security costs are actually necessary considering the possibility of electronic security. “There are also several contracts with cleaning companies even though the government has a cleaning service”, according to Soab.

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