Corruption alleged in 90 luxury flat project

Corruption alleged in 90 luxury flat project
September 07 15:20 2015

The opposition has lodged a complaint with the Anti Corruption Commission (ACC) over the awarding of a contract without a bidding process to a real estate company to build a 20-storey luxury apartment complex in Malé.

In a letter to the ACC on Sunday, the Maldivian Democratic Party (MDP) noted the project had been awarded without a bidding process. “Awarding projects to specific parties, without a bidding process, contravenes the Public Finance Act.”

According to the housing ministry, the 90-flat project was proposed to the government by Amin Construction. The project was approved by the cabinet’s economic and youth council. The real estate company is to handover 18 flats to the government upon completion.

Amin Construction is to obtain finances for the project. The agreement was signed on September 1.

According to an ACC spokesman, the five commission members will evaluate the complaint before voting to accept it.

President Abdulla Yameen in a speech in Raa Atoll Innamaadhoo last week said the tendering and evaluation process needs to be reduced in order to speed up the completion of infrastructure projects.

In May, the government brought changes to the public finance regulations to authorize the cabinet to award mega projects and projects carried out by concessional loans or assistance from a foreign country without a bidding process or approval by the tender evaluation board.

State institutions were previously required to seek approval from the tender evaluation board to award contracts for projects worth more than MVR1.5 million (US$97,276).

Under the new rules, the economic council is only required to review information such as the project’s details, estimated cost and chosen contractor before approving contracts. The information must also be shared with the Anti-Corruption Commission (ACC) and Auditor General’s office.

“The cabinet’s economic committee or council must ensure that the party to which the project is awarded is qualified in terms of financial [means] and expertise,” reads the provision added to section 8.15.

Critics have said the move paves the way for corruption and allows the government to award projects to specific parties.

In March, Amin Construction was awarded a plot of land in Malé’s suburb Hulhumalé for the construction of some 279 apartments in three separate towers. The complex is called Amin Avenue. The Housing Development Finance Corporation (HDFC) is financing 80 percent of the project.

Prices of flats range from MVR2.1million (US$136,000) to MVR6.5million (US$557,717).

Several housing projects are ongoing in Malé. These include 1000 units by Apex Reality, a company owned by India’s Tata, 72 housing units by FW Construction Company, and another 72 housing units by 4Pals Maldives.

Malé is among the most densely populated cities in the world, and successive governments have struggled to provide adequate housing for its increasing population.

FW Construction is the only company to complete the flats.

In April, the government kicked up controversy when it awarded some of the luxury flats by FW Construction at discount prices to the five Supreme Court judges and four heads of independent bodies.