Former CEB Chief faces legal action

By Ifham Nizam

Ceylon Electricity Board (CEB) Chairman W. D. Ganegala has ordered legal action against former CEB Chairman Vidya Amarapala and retired CEB General Manager Nihal Wickramasuriya to recover Rs. 35 million paid as compensation to a consultant because of their decision to terminate his contract arbitrarily.

CEB Chairman, asked for comment, told The Island that following the preliminary investigations by retired audit superintendents he had asked the Secretary to decide whether to proceed or not with the case.

In 2008, CEB awarded the consulting contract for its proposed head office building at Kirimandala Mawatha, Narahenpita to Pan Arch Limited after following the Government tender procedure.

However, after Patali Champika Ranawaka assumed duties as the Minister of Power and Energy in May 2010, the new management of the CEB decided to terminate the properly awarded contract and implement a "new plan."

The reason given was that by adopting the "green building" concept, CEB could save millions on construction costs and yearly building running expenses. Accordingly, a new consulting contract was awarded to the Consulting Unit of the Architecture Faculty of the University of Moratuwa without calling for tenders.

This consulting unit is not subject to any government audits or oversight by the University administration, but functions as a private entity.

It is understood that the former General Manager had terminated the contract without seeking legal advice or without approval of the CEB Board. Pan Arch claimed damages from CEB for breach of contract and won an arbitration award of Rs. 35 million, which was significantly higher than the remaining payments due to it by the CEB on the original contract.

In the meantime, on the recommendation of the new consultant, CEB has spent over Rs. 350 million on piling, although the Municipal approvals for the building plans are still pending.

The present CEB Board has decided to abandon this construction project after spending over Rs. 500 million on consulting fees, arbitration award and piling, in addition to salaries of several fulltime staff including senior civil engineers.

In the meantime, CEB’s subsidiary LECO too has faced a similar predicament with respect to its proposed new head office building at Elvitigala Mawatha, Colombo 5.

The Board of Directors of LECO had taken a decision in 2010 to award the consulting contract to Central Engineering Consultancy Bureau (CECB), but had later awarded the contract to the same consulting unit at the Moratuwa University, on the insistence of then Minister Ranawaka.

The present board has expressed its extreme dissatisfaction on the quality of consultant’s work and had asked CECB to review the building designs.

The Island learns that CECB has pointed out several major flaws in the original design submitted by the Architecture Faculty of the University of Moratuwa and asked LECO to get the necessary corrections done by the same consultant.

Employees of CEB and LECO say these costly decisions were based on certain personal loyalties with no regard to resulting waste of colossal sums of public money.

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