From the Auditor General’s Office of the Cayman Islands

Reporting on a lack of clarity in the Government’s contracting practices, the Auditor General has identified opportunities for improvement in how officials carry out the process in her most recent report issued to the Legislative Assembly.

“Recently, there have been some very positive developments that promote more effective procurement practices including the passage of new legislation and the creation of a central procurement office,” said Sue Winspear, Auditor General. “This report identifies opportunities for better guidance to government officials involved in the acquisition of goods and services.”

The public interest report examined a contract for the removal of scrap metal from the landfill sites on Grand Cayman and Cayman Brac signed in 2013.

More information regarding this report can be obtained by contacting Martin Ruben at the Office of the Auditor General at (345) 244-3206. A copy of the report is available at www.auditorgeneral.gov.ky.

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CONCLUSION (From the Aud Gen Report)

We have concluded that there is room to improve the Cayman Islands Government procurement policy and legislation. The policy and legislation in place when this contract was awarded did not provide the level of clarity, guidance and rules that are present in the United Kingdom. The procurement policy of the Cayman Islands would be more effective if it provided greater clarity to those who are required to use it.

The substantial difference in detail between the procurement policy and legislation in the Cayman Islands and the United Kingdom contributed to the issues discussed in this report. The United Kingdom provides detail around a large variety of procurement aspects, whereas the Cayman Islands provides detail on specific procurement aspects but does not address a large range of areas, leaving a lack of guidance or clarity in many areas.

In this engagement, with the information made available to us, we have seen no evidence that suggests that members of the Department or the DTC acted in an unethical manner when undertaking the tender and award process for the Contract.

Having conducted our own tender process, based on the information available to us, we believe that the information contained in the bid submissions should have led to a different conclusion than arrived at by the DTC. We used the same methodology as that prescribed in the Open Tender Process to complete the scoring system used to evaluate tender proposals and from the information provided to us, the tender proposal submitted by Cardinal D was not complete and failed a number of ‘pass/fail’ criteria that are identified in the tender requirements. Furthermore, the information provided by Island Builders appeared far more comprehensive and professional than that provided by Cardinal D in their tender proposal.

As previously stated, none of the information we have witnessed suggests any error or non- adherence to the process.

We do not believe that the scoring methodology for evaluating tender proposals used for the contract was appropriate. We were advised that the primary objective of the contract was to remove scrap metal from the Cayman Islands, yet the scoring methodology focused on price as opposed to ability to execute. We do note that Cardinal D and Island Builders scored equally in this category to the ESTAR report completed by the DTC.

Our primary view is that, to increase the effectiveness of procurement, improvements to policy need to be made to provide departments and individuals that undertake a procurement process with the appropriate clarity and guidance at all stages.

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The above was the subject and award of a scrap metal contract to Cardinal D.

On 16 April 2013, a Request for Proposals (RFP) for the contract was made available to the public through the local press, the CTC website and the Waste Age website. The RFP set a deadline of noon 1 May 2013 to receive all proposals. It detailed a number of items that a proposal would need to incorporate to be valid. These included a completed tender form; qualification statement; proof of required insurance; and a signed copy of a joint venture partnership where applicable.

The RFP stated that the objective of the contract was to sell all remaining scrap metal at best value and ensure its prompt and timely removal. We were also advised by Mr Roydell Carter of the Department that the key objective of the contract was the successful and timely removal of scrap metal from the three sites and that the price was a secondary factor.

Tender applications were received from two parties prior to the deadline of 1 May 2013: • Cardinal D, and

Islands Builders Limited. 14. No other applications were received.

See Exhibit 2 showing the points awarded by the panel that the Auditor general did not agree with.