POLCO accused of corruption in award of MVR 350mn catering contract

Police Corporative Society (POLCO) faces fresh allegations of corruption as it stands accused of awarding a 10-year contract worth MVR 350 million to cater food to Maldives Police Service in violation of the permit issued by the Finance Ministry.

The new allegation stems from a catering contract POLCO awarded to Police Catering (POLCAT) in 2018.

During a meeting of the Parliament’s Public Accounts Committee on Monday, Deputy Speaker Ahmed Nazim said the Finance Ministry’s tender board had granted permission to award a five-year contract.

However, POLCAT received a 10-year contract – double the duration permitted by the tender board.

“After the Finance Ministry’s tender board granted permission for a five-year [contract], this officer has written here to form a 10-year contract,” said Nazim.

He said that documents show the contract was worth MVR 35 million per annum – meaning total MVR 350 million for 10 years.

“We are talking about huge sums [of money]. They doubled what the tender board permitted with zero hesitance…. This is the issue I’m talking about,” said Nazim.

“There is this culture within some uniformed institutions… a “yes sir” mentality when one officer asks something of another. But it cannot be done in violation of laws and regulations.”

Nazim said the Parliament therefore cannot skip a review of the dealings of corporative societies.

 Nazim said that if the contract had been formed for five years as approved by the tender board, then it would have expired in 2023, just ahead a new presidential term. He alleged that the contract was signed for 10 years to prevent the lucrative catering contract going to another company.

The Public Accounts Committee initiated its inquiry into POLCO after an audit report released in January uncovered losses amounting to MVR 354.7 million due to POLCO’s “corruption and incompetence” in the 2013 police housing project ‘Blues Housing Project’.

The audit uncovered that the project – which should have cost MVR 745.3 million or MVR 859.9 million at the most based on average market price – cost over MVR 1 billion.

The Auditor General’s Office recommended action against top officials at POLCO, including board directors.