Board approves €24 million tender despite tainted procedure

The Public Contracts Review Board (PCRB) is allowing the Health Ministry to go ahead with the issue of a €24 million tender for the purchase of an MR LINAC cancer treatment machine despite the objections of a prospective supplier that the tender was designed for one specific company.

In its decision following a request for remedies before a final tender is published, the PCRB agreed with appellant Charles De Giorgio Ltd that the contracting authority was not transparent when asked to clarify why a new bunker needs to be built when the one originally intended for the machine will be left empty.

However, the Board concluded that the procedure used by the ministry was the right one, as it was not bound to base its new tender on the provisions of a preliminary market consultation done in the pre-tender phase and issued prior to the proper tender.

It later transpired that a member of the PCRB deciding the case, lawyer Vince Micallef, had a conflict of interest and did not declare it prior to the commencement of procedures.

The suspicious multi-million euro manoeuvre

In an earlier series of reports, The Shift revealed that last year the government issued a PMC requesting suppliers to provide an MR LINAC machine at a cost of some €12 million. The PMC specified that the machine had to fit inside an already existing bunker at Msida’s Oncology Hospital (SAMOC).

Four submissions were made. One of the prospective bidders submitted a machine that does not fit the existing bunker and suggested that a new 5^th bunker be built, raising the cost of the EU funded project by some €12 million to €24 million.

Instead of moving ahead with the project, the Health Authorities, particularly the management of Mater Dei and the Foundation for Medical Services (FMS), rewrote the tender asking for a new 5^th bunker to be built, together with the provision of the new facility.

Supplier Charles De Giorgio Ltd insisted that its machine would fit the fourth bunker perfectly, and there was no need for the additional expense of building a new one. The company sought an explanation for the sudden change of direction in the tender.

None was forthcoming from the FMS or Mater Dei, except for a terse reply stating the 4^th bunker originally proposed was found to be not fit for purpose. Charles De Giorgio Ltd filed an appeal.

The PCRB concluded that, while it was true the authorities were not transparent in giving adequate replies to justify the changes they inserted in the tender, technical documents presented by the FMS and Mater Dei confirmed that it was not technically possible to fit a new MR LINAC in the existing bunker, and that there was a need for a new one at an additional expense of €10 to €12 million.

The PCRB has ordered the procurement process to continue.

Any conflict?

One of the PCRB board members deciding on the appeal, lawyer Vince Micallef, a former police officer involved with the Labour Party, declared a conflict of interest halfway through the procedure.

Prior to testimony given by Carmen Ciantar, FMS CEO and chief canvasser for Health Minister Chris Fearne, Micallef suddenly declared that Ciantar is his personal client and asked if there were any objections to him staying for his client’s testimony.

As the politically appointed CEO of the FMS, Ciantar formed an integral part of the process leading to the public procurement exercise. Her personal lawyer would be taking part in a decision that directly affected the FMS.

No one, not even representatives of Ganado Advocates appearing for the appellant, raised objections.

The supplier that had originally suggested the need for a new bunker is Technoline Ltd, a company at the centre of the controversial Vitals Global Healthcare takeover of three public hospitals in 2015.