The Sunday Leader

Government Chief Valuer Made To Amend Report

by Nirmala Kannangara 

  • Former Secretary, Sivagnanasothy when contacted said there is nothing wrong to make an ‘appeal’ to the Chief Valuer to amend the rental rate considering the market value
  • When the Chief Accountant and the Accountant were asked to sign the voucher to make the security deposit payment, both had refused to comply
  • “Paying more than what the government valuer said is not a fraud. We are paying the market value”

The controversial building at Colombo 3, Presidential circular directing for government valuation when renting private buildings, The amended valuation report for Rs. 4.2 million in order to settle the dispute, Sivagnanasothy’s letter to the Chief Valuer requesting to amend the valuation, The first valuation report for Rs. 3 million per month and Prison Reforms Rehabilitation, Resettlement and Hindu Religious Affairs Minister D. M. Swaminathan

Tender scams under the good governance administration are escalating and action has not been taken against the fraudsters by the government who promised to put a complete stop to corruption when they were in the Opposition.

First it came to light as to how under the present regime, a valuation report of the Government Chief Valuer was ignored and a building was rented at a higher rate to house the Ministry of Agriculture in Rajagiriya.

Now startling revelation have come to the fore as to how the former Prison Reforms Rehabilitation, Resettlement and Hindu Religious Affairs Ministry Secretary V. Sivagnanasothy had got the Government Chief Valuer to amend the valuation report of a building to suit the owner’s requirement.

However former Secretary, Sivagnanasothy when contacted said there is nothing wrong to make an ‘appeal’ to the Chief Valuer to amend the rental rate considering the market value.

Be that as it may, Sivagnanasothy is accused of renting out a building at 356/1, Carwill Place, Colombo 3 for a higher rental against the Government Chief Valuer’s valuation report.

In order to house Prison Reforms Rehabilitation, Resettlement and Hindu Religious Affairs Ministry, Deputy Minister’s office and all the departments that come under Prison Reforms Rehabilitation, Resettlement and Hindu Religious Affairs Minister D. M. Swaminathan – the  Palmyrah Development Board, North Sea Limited, Rehabilitation of Persons, Properties and Industries Authority (REPPIA), Resettlement Authority, Department of Hindu Religious Affairs and Commissioner General of Rehabilitation Bureau under one roof for easy administration, tenders were called for office space in and around Colombo.

The Ministry of Rehabilitation, Resettlement and Hindu Religious Affairs Procurement Committee invited for bids on September 18, 2015 for office space between 24,000 to 30,000 square feet on rent within the City limit or Sri Jayawardenpura Kotte municipal area. At the time the tender was closed on September 28, 2015 eight bids had been submitted for evaluation and the three lowest bidders were selected.

The Technical Evaluation Committee (TEC) on October 7, 2015 decided to inspect the first three lowest bids and the lowest bid was the former Immigration and Emigration building at Ananda Rajakaruna Mawatha, Colombo 10. Although the Technical Evaluation Committee (TEC) was satisfied with the lowest bidder as it met the Ministry Procurement Committee requirements, later it was rejected as it was not vacated for occupation.

The second lowest bid was from 28, Lauris Place, Duplication Road, Colombo 4 and their quoted price was Rs. 145 per sq.ft, and the TEC made a physical inspection on the second and third lowest bids. The TEC recommended renting out the second lowest evaluated bid as it met the Ministry Procurement Committee (MPC) but rejected the third lowest bid which quoted Rs. 145 per sq.ft, which was earlier occupied by the Financial Crimes Investigation Division (FCID) and because the parking spaces were not enough to meet the ministry requirements. Meanwhile, the TEC had recommended the MPC to negotiate and reduce the rental rate with the owner in line with the rate of the government valuation department.

When plans were afoot to go ahead with the second lowest bid, Minister Swaminathan and Secretary Sivagnanasothy had objected claiming that because the building is occupied by some residencies that they need a separate building – the former FCID building. Since the Chief accountant R. Wasantha Kumara Perera who was a member of the initial MPC was not happy with the decision, Sivagnanasothy who was the Chairman of the initial MPC appointed another tender board for the purpose. “This was done against the government procurement guidelines. When a procurement committee is appointed, the same committee has had to function in the committee without any change until the tender is awarded to the prospective bidder. New members can be appointed to the committee in the event of unavoidable circumstances. Since Perera objected to the decision to taken by the Minister and the Secretary he was removed without any valid reason and the new committee headed by Additional Secretary M.M. Nayeemudeen as the Chairman and the Accountant of the Hindu Affairs Department was appointed instead of Perera and took the final approval to obtain the former FCID building which did not have enough of parking space,” highly reliable inside sources said on condition of anonymity

According to the sources, the reason given for the selection of the third lowest building was that it locates next to Galle Road, closer to railway station, bus stands and is in a decent and prime area and its location, quality, condition, easy access exclusively, privacy and security comparing to the second lowest bid at Duplication Road, Bambalapitiya.

The MPC that was appointed with the ‘catchers’ of Swaminathan and Sivagnanasothy in their report to substantiate the reason why they recommend to rent the former FCID building, in their report dated December 21, 2015 states the reason why procurement committee rejected the second lowest bid was that the ministry has to share the parking area and the lift with the people who are residing in upper floors of the building. The report further states as thus, ‘The second lowest bidder for office building is at 28, Lauris Place, R. A. de Mel Mawatha, Colombo 3. The entire building consists of more than 60,000 sq.ft. and there is a housing apartment adjoining the proposed building and the parking facility also has to be shared with the occupants of the housing apartments. According to the current needs of the ministry, the required office space is approximately 35,000 sq.ft. Hence Ministry has to share this building with some other organisation; the common area of the building such as the lobby, lift and other facilities has to be shared subsequently. It may lead to conflict of interest and need to face unwanted issues and security and privacy concerns. Therefore this is going to be a shared arrangement not exclusively for the ministry’.

According to Presidential Secretariat circular dated May 14, 2010, by the then President Secretary Lalith Weeratunge to all Ministry Secretaries, approvals will be granted to rent or lease a private building, it rental should be on par with the government valuation. Hence on December 12, 2015, Sivagnanasothy had written to the Government Chief Valuer and the according to the government valuation report dated January 12, 2016, the monthly rental value was Rs.3 million for the said building at 356, Carwill Place, Colombo 3 and this rental value applies only for two years.

Surprisingly, Sivagnanasothy, the following day after he received the valuation report (Ref. MPRRH/2/4/Build 356), wrote back to the Government Chief Valuer has stated that  although according to the valuation a square foot of the said building is Rs. 85.47 the owner of the building had requested Rs. 145 per sq ft and considering the high rental values in the area requested to amend the valuation report. This letter was followed by two other letters to the government valuer dated January 20, 2016 by Additional Secretary M.M. Nayeemudeen and January 25, 2016 by V. Sivagnanasothy making the same request. As a result, G. S. Wijewardene Provincial Valuer (Greater Colombo) for the Chief Valuer in his letter dated February 1, 2016 addressed to Secretary Prison Reforms, Rehabilitation, Resettlement and Hindu Religious Affairs Ministry V. Sivagnanasothy has amended the earlier monthly rental valuation to Rs. 4.2 million. The letter further states that he was submitting the amended valuation in order to ‘settle the matter’. Disregarding the amended valuation report, Minister Swaminathan and Secretary Sivagnanasothy finally had take a decision to pay Rs. 5.089 million as the monthly rental to please the owner of the building.

“According to the amended valuation report, valuation for a square foot was Rs. 120 but still the Minister and the Secretary wanted to pay Rs. 145 as per the owner’s initial request. In addition to this, the controversial Ministry Procurement Committee had also wanted to pay six month refundable security deposit to the owner of the building- Leedons Builders (Pvt) Limited to the amount of Rs. 3.053 million. When the Chief Accountant and the Accountant were asked to signed the voucher to make the security deposit payment, both had refused to comply. When this was informed to the Minister, both officials had stated that they do not want to get involved in any malpractices. The Minister had then asked both of them to give an explanation in writing to which they have done so on March 10, 2016,” sources claimed.

Since Assistant Secretary Nikarilkanth and a Senior Assistant Secretary who represented the TEC too were strictly against the Minister and Secretary’s move to bypass government procurement guidelines, Secretary Sivagnanasothy got these two officials transferred to a different Ministry claiming that these two officers were an obstacle to the smooth functioning of the Prison Reforms, Rehabilitation, Resettlement and Hindu Religious Affairs Ministry work.

Later the Secretary got the Chief Accountant Vasantha Perera too transferred, but Perera filed a Fundamentl Right case in Supreme Court and got it on hold till the case is over.

According to the sources, since the Chief Accountant and the Accountant did not approve the payment of Rs. 3.053 million, the Secretary and the Minister had got the six months security deposit reduced to three months deposit and instructed the Palmyrah Development Board, Rehabilitation Commissioner General’s Office and the Rehabilitation Authority to contribute Rs. 5 million each to make the payment. “This is completely a financial fraud. Misappropriation of public funds is a severe financial fraud. Although the Minister said that he wants to bring all the departments and the Ministry officials under one roof the building is not spacious to bring all the departments to this building and still some of the institutions are functioning from other buildings. We have already lodged complaints against this fraud at the FCID and the Bribery Commission and hopefully waiting for them to take action against those who were involved in this major scam,” sources claimed.

However when contacted Minister Swaminathan to find out why such a scam had taken place, the Minister said that there is no such scam as highlighted but he has saved money to the government by bringing all the departments under him to one building. But however he admitted that the Hindu Affairs Department is functioning from Wellawatte as they pay only a minimal monthly rental.

“Why cannot we make an appeal to the Government Valuer? There is nothing wrong in that. The valuation was not in order and I had to approve the building owner’s request as this building is in one of the prime locations in Colombo. I did not want to shift to the second lowest building as we have to share the lifts and other common areas with the occupants on the top floors. As the Subject Minister haven’t I got a choice to move to a place where I want? Paying more than what the government valuer said is not a fraud. We are paying the market value,” Swaminathan said.

Meanwhile, the former Secretary Sivagnanasothy too aired the same views as of the Minister but went to the extent saying the TEC and the MPC gave their approval to select the building in question and added that it was on that basis the final decision was made. But however when told that this newspaper is in receipt of the initial MPC and TEC reports that shows that they recommend the second lowest building but not the third lowest, Sivagnanasothy told this reporter not to write misleading and incorrect articles just because there is media freedom in the country and for having a pen and a paper in his/ her hand. “I am a senior Secretary with an unblemished service record. We have carried out this process transparently. We have not done anything against financial regulations,” he added.

3 Comments for “Government Chief Valuer Made To Amend Report”

  1. kudson

    crooked politicos under yahapalanaya
    running wild
    bribes, kickbacks is normal
    how much income tax are these building owners paying
    and what is the municipal tax

  2. kumar

    Go o any government office 1/3 rd of the staff are idling or making the system creek. If you cut down on the staff you wont need such extra space as well improve efficiency They are a drain on the poor man,s resources.Send them to Hambantota if you cannot dispose them.

  3. aggydaaggyddddsd

    Yahapalanaya politicos are in a mighty hurry running wild on the run with bribes, kickbacks & santhosams.
    Wahalkada sand business had changed hands from Weli Raju to Appachchi Malo.

    SB dissanayake said he even did not know how mu8ch he was paid as a politician. probbably he was not interested in his pay.

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