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New National Quarries boss orders forensic audit
Newly-appointed chairman of National Quarries Company Ltd (NQ) Keshwar Maharaj has asked for a forensic audit into the state-owned company after finding out that proper procedures may not have been followed in awarding contracts.
The request for the audit comes four months after People’s National Movement Senator Faris Al-Rawi called on NQ’s then chairman Mitra Ramkhelawan to clear the air on how much was spent to purchase a “refurbished” Volvo excavator which was listed on one set of documents as costing US$317,968.75 and on another as US$92,000.
Days after the exposé, Ramkhelawan, who had suspended NQ’s CEO Sandra Fernandez on the basis of her qualifications, was fired by Finance Minister Larry Howai. This led to the collapse of the entire board.
Ramkhelawan has maintained his innocence against allegations of financial impropriety and mismanagement at the state organisation.
On Thursday, Maharaj said the Fraud Squad investigation into the purchase of the excavator was ongoing and from time to time they would request documents from NQ.
“And there will be more investigations,” Maharaj said, refusing to say into what or who.
“We are going to set up a forensic audit into the company and leave it for the people who are technically sound to deal with it.”
Maharaj said NQ has since taken steps to ensure that over-invoicing did not re-occur.
“As a matter of fact, one of the things we are doing now (is that) every single person who engages a service with this company must have a contract.”
Maharaj: Lack of proper management checks
He said the systems at NQ did not allow proper management checks.
“It was somewhat on autopilot. In fact, when we came here, we had a lot of arrangements that were done by ‘shake hand.’”
Told that this was what the People’s Partnership Government fought against in the 2010 general election, Maharaj said, “When we realised certain things were not going the way it was supposed to go, that is why a new board was put in place to deal with this type of situation and not to allow this to happen.”
Asked how many contracts were given out with proper procedures, Maharaj said NQ was doing an evaluation on that at present.
“We want to correct all the wrongs. In the past people used to do things in a way that was not really in line with good corporate governance. And those are the things we are trying to introduce here so we can get value for money.”
Asked if many wrongs had been committed, Maharaj said, “I would say there was a fair amount of misadventures taking place. In the interest of good governance we need to tighten the screws all around. You know, there was sabotage taking place and security issues.”
Was NQ faced with corruption before his tenure?
Maharaj said a lot of things needed to be checked, including the purchase of the excavator.If his board had been at NQ earlier, he said, things would have been managed differently.
Some of the things Maharaj said he was not pleased with were the efficiency of its operations, as a lot of senior posts in the company remained unfilled and there was low staff morale.
NQ recovers US$110,000 from excavator purchase
He said the only positive thing that came out of the excavator fiasco was the repayment of US$110,000 by Global Trade and Financing, which had facilitated a transaction for the purchase of the equipment eight months ago.
NQ was expected to pay US$317,968.75 but its bankers erroneously wire-transferred US$427,968.75, an over-payment of US$110,000.
Maharaj said the US$110,000 was to make additional purchases.
“I thought it was not wise to have our money sitting there on a prospective purchase order so I requested the money back.”
The money was wire-transferred into NQ’s account on December 27, 2013.
Told he was perceived as a puppet, Maharaj said the only reason he took the job was because the Government needed someone on board with a clean pair of hands, and no one could accuse him of being corrupt or bringing the corporation into disrepute.
“They know what I had done at the Sangre Grande Regional Corporation as chairman. Not a single person can say that I took a soft drink from a contractor.
“If anyone tries to influence me I would tell them where to get off. I do not need this job to be a puppet.”
In his first meeting with Ramnarine, Maharaj said, he informed his directors that if they were looking to make money at NQ they should look for another job.
NQ to get a $20 million crushing plant
By September, Maharaj said, NQ will have its own crushing plant for Scott’s Quarry, which has a natural reserve of $4 billion.
The decision to purchase the plant was finalised by NQ’s board and later discussed with Energy Minister Kevin Ramnarine before he left for China on Friday with Prime Minister Kamla Persad-Bissessar.
The move comes four months after the contract of Malaysian-based Sunway International came to an end.
NQ had expressed an interest in purchasing Sunway’s plant for $20 million, but things did not work out, Maharaj said.
Maharaj said they approached Ramnarine to purchase a $20 million plant through a government-to-government arrangement in China.
Once the plant is installed, Maharaj said, NQ will no longer send out tenders seeking the services of businesses to produce aggregate and limestone at Scott’s Quarry, but would undertake the job in order to get back on track and remain viable.
Aggregate is used in the construction industry and is a key material in road paving.
Will this result in an increase of aggregate prices?
Maharaj said it was not one of NQ’s priorities. “However, if we have to increase the cost it would very minimal.”
Since his appointment, Maharaj said, no one has expressed an interest in operating Scott’s Quarry.
Last November, the Sunday Guardian reported that at least one contractor—Jusamco Pavers Ltd, headed by Junior Sammy—wrote to Ramkhelawan on August 2, expressing an interest in operating Scott’s Quarry and asking to be “favoured.”
NQ owns and manages the quarry in Blanchisseuse, and Turure Quarry which can generate revenues in excess of $200 million annually.
In the interim, Maharaj said, NQ will bring in small operators to pick up the slack until the plant is up and running.
“Our option is to get our plant that can deliver more output.”
Sunway produced on average 500 tonnes of aggregate an hour.
No party hack for CEO position
NQ intends to retain a recruiting company to select its new CEO. The company will advertise the CEO post, do interviews and make its final pick by the end of April.
“It would be independent people so that we have no influence over the selection process,” Maharaj said.
He said NQ’s HR department has been working to speed up the recruitment process, since the company has been without a CEO for four months.
“We want to have the appointment transparent. We do not want to hear that we put a party hack. We will divorce ourselves from that. This thing will be properly done. We will hire a recruiting company and let them take the decision on interviews and work within the company’s guidelines. The board would ratify their decision.”
The new CEO will replace Sandra Fernandez, who was suspended last October by Ramkhelawan. NQ has agreed to pay Fernandez in an out-of-court settlement, which Maharaj refused to disclose, but insisted it was not $800,000 as reported.
Asked if the new CEO will be paid a monthly salary of $48,000, similar to what Fernandez took home, Maharaj said it all depends on the individual’s qualifications and skills.
Chairman’s $510,000 Nissan Pathfinder up for sale
A $510,000 Nissan Pathfinder which NQ purchased for its chairman is up for sale. Once sold, Maharaj said, NQ would use the money to buy a bus to transport workers to and from its quarry site in Turure, Sangre Grande.
Maharaj said the decision to sell the three-year-old PCT series Pathfinder was a taken by the board after staff complained that it was difficult to reach the quarry site at night.
“So one of the decisions we took was the Pathfinder, which was purchased for the use of the chairman, I have asked them to return it to the company (the agent), so we could get a bus for the workers.”
As chairman, Maharaj said, he believes he is not entitled to drive a company vehicle.
“I get travelling and I have my personal vehicle which I use.”
Maharaj said he has asked NQ and the company from which the Pathfinder was purchased to do an evaluation to determine its value. If the bus is more expensive, NQ will pay the difference.
“But I think a bus would be cheaper than the Pathfinder. So we would look at the cost-effectiveness of it, whether a trade-in might be good.”
Last October, Ramkhelawan, in an Express article, said as chairman, he suffered the indignity of using the Pathfinder, which he said had tyres as smooth as glass.
“Normally in my area, I bend my head while I am in it. It’s a bit disgraceful,” Ramkhelawan said.
Ramkhelawan: Everything was done above board
On Friday, Ramkhelawan said every decision the board made under his tenure was done above board and in a transparent manner.
“No contract was awarded except two that were publicly tendered and it followed every procedure. I have no idea what Mr Maharaj is speaking about.”
Ramkhelawan said he never signed any cheques at NQ.
“What I have to account for is what is in the board minutes.”