Westland District Council goes ahead with controversial firm for water treatment plants
The Westland District Council will go ahead with a controversial contract with an Auckland-based cake decorator to upgrade two water treatment plants.
Westland mayor Bruce Smith confirmed on Thursday the council would proceed with the $405,000 contract with Techno Economic Services to upgrade the Kumara and Whataroa plants.
"Westland District Council resolved at its January meeting to award system provider Techno Economic Services NZ Ltd (TES) the contract to upgrade the Kumara and Whataroa treatment plants. The contract to TES contained a $100,000 bond to be lodged with council. The correct bond was lodged on time," he said.
In March, after publicity about the company director being a cake decorator, council decided to reassess the contract to confirm the correct tender process was followed.
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"Council sought and obtained clarification on the tender evaluation process from two independent engineers on the tender evaluation panel.
"Council is happy to announce the upgrades will be commencing soon."
Vivek Goel, who is on leave from his position as assets manager for the Westland District Council, oversaw the controversial offer of a $7m contract to build a wastewater treatment plant in Franz Josef to TES. TES director Neha Bubna is a cake decorator from South Auckland.
Bubna told Stuff at the time she had no experience in sewage plants. She declined to comment when contacted on Thursday.
Goel is under investigation by the Serious Fraud Office. The SFO has declined to discuss the allegations against Goel.
Smith said the plant would be supplied by an Indian-based company and installed by Hokitika sub-contractors.
"My understanding is the Indian-based company bought a shelf company registered in New Zealand. They needed to have a New Zealand-registered company with a New Zealand-based director to be able to be registered for PAYE and GST. They need to pay GST on importing the plants through customs," he said.
"The independent engineers rang the principal in India and spoke with him. He has water treatment plant experience in many places around the world, but not in Australia or New Zealand," Smith said.
"A legal process has been followed and we are looking forward to plants being installed in both towns."
The contract would be partly paid by a $275,000 Ministry of Health subsidy.
Smith expected the two plants to be operational by the end of August.
The plants will include a combination of filtration and UV disinfection and allow staff and plant operators to access the plant computer remotely. Kumara had a boil water notice in place for most of January and some of February.
Smith said the Kumara and Whataroa contracts were first considered at the December council meeting.
"I looked at the report and said, 'guys this is an unknown party with principals based overseas and there is insufficient bonding and retentions. I'm not going to support it'."
Chief executive Tanya Winter removed the item from the agenda and a new contract was drawn up for the January 23 meeting.
It included a $100,000 bond and 40 per cent retention, Smith said.
"On that basis the council voted in favour."