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Govt allays fears over Bidvest deal


Billy Ntaote

Finance Minister ‘Mamphono Khaketla says Bidvest Car Rental would not be among companies bidding to supply government with fleet services when its six-month deal expires in March next year.

The South African firm was awarded the contract to supply government with vehicles and maintenance services beginning 1 October after Avis Lesotho decided to withdraw its services with immediate effect.

Avis had supplied government with fleet services since 2007, but a bitter fallout over monies owed resulted in the termination of the relationship.

However, the Bidvest deal has since opened a Pandora’s box, with opposition parties and public transport operators among those questioning the decision to award the contract without putting it to open tender and considering Basotho first.

But responding to the criticism on Friday, Dr Khaketla reassured Basotho entrepreneurs that the South African firm was only here as a stop-gap measure.

The minister explained government contracted Bidvest through selective tendering to avert a crisis after Avis decided to withdraw its services at short notice.

“Avis elected to withdraw its vehicles so we had to avert the imminent crisis and find people who could assist us at short notice. That’s when Bidvest was invited. I requested cabinet on 21 September, to allow us to give Bidvest a six-month contract that Avis had refused to enter into.

“We did this in line with Lesotho Government Procurement Regulations of 2007 Section36 (1) (d), which say: Non-competitive contracting may only be used in the following cases irrespective of the estimated value of good, works or services…it is impossible to adhere to the tender submission deadline pursuant to open and limited procurement procedure as a result of unforeseen circumstances such as a national emergency, and the cabinet of ministers agreed,” said Dr Khaketla.

Bidvest, the minister added, was asked to supply government with 1200 vehicles by 28 September and the company had delivered 1107 to-date.

However, Dr Khaketla noted Bidvest would not be bidding for the tender when its current deal expires in March 2016—and that bids would soon be invited for the fleet contract.

Dr Khaketla explained how the dispute with Avis came about.

“Initially, I was told we owed Avis M56 million. And when I made further inquiries, I was told Avis and different ministries were at loggerheads over the actual amounts they owed the company. I was also told government had a contract with Ernst & Young, an audit firm, and that the company was invited following a 2012 World Bank report that showed Avis was fleecing government.

“We have the report and the response issued by Avis for those keen to go through it. In the meantime, we are waiting for a report from Ernst & Young which should be in by the end of this month,” said the minister.

Dr Khaketla also said she instructed Avis to be paid M49million of the M56million the firm was demanding from government, by the end of the 2014/2015 financial year.

“But in a shocking development, Avis wrote a letter to the ministry after being paid the money, demanding M59 million above the M56 million.

“That’s when we started to have heated arguments over these amounts, and our relationship soured. Avis started refusing to repair government cars and give replacement vehicles.

“What was also shocking was that in the middle of the arguments and poor service we were receiving, the company was also inviting government to buy 25 percent of its shareholding,” said Dr Khaketla.

Government, she added, ended up offering Avis a six-month contract renewal.

“But the company made a counter-offer saying it was only prepared to accept the six-month extension in order to negotiate a new contract, failure of which it would be terminating the deal on 30 September.

“Government had no choice but to look elsewhere as Avis wanted to trick us,” Dr Khaketla said.

Meanwhile, Avis Managing Director Keith Dell has since said he would not comment on the company’s spat with government.

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