The Government Inspectorate has recently issued findings related to the projects on building the second facilities of Bach Mai and Viet Duc Friendship Hospitals.

These projects, managed by the Major Healthcare Projects Management Board, were submitted to the Minister of Health in 2014 for approval to hire foreign consultants for project planning.

Foreign consultants chosen before approval

Inspectors found that the then-Minister of Health approved hiring foreign consultants to design both projects without proposals, and even before the projects were approved.

In the document submitted to the Ministry of Health (MOH), the investor proposed using foreign consultants, affirming that “domestic consultants couldn’t meet requirements, necessitating foreign ones".

In Notice No 417 dated May 9, 2014, MOH directed to choose VK Group (Belgium) as the project consultant without a bidding process.

“The proposal and approval to hire foreign consultants was subjective and deliberate, picking VK Group without assessing domestic consultants’ capacity and experience, seriously breaching Vietnam’s bidding laws and foreign consultant hiring rules in construction,” the findings state.

The Government Inspectorate also deemed the proposal, approval and selection of architectural design plans for both projects as gravely flawed.

The Director of the Major Healthcare Projects Management Board sought approval for architectural design plans with VK Architects and Engineers before the Minister of Health approved hiring foreign consultants.

Selecting VK Architects and Engineers without a design contest lacked clear justification.

There was also a mismatch: the proposed consultant for architectural design (VK Architects and Engineers) differed from the chosen one (VK Group, represented in Vietnam by VK Vietnam Co., Ltd.).

Documents presented by the investor showed no legal status for VK Architects and Engineers, nor proof that VK Vietnam Co., Ltd. represented both VK Group and VK Architects and Engineers in Vietnam.

Consulting costs inflated, $80 billion loss

Inspections revealed that estimating and verifying costs for foreign consultants in pre-investment budgets lacked a basis, far exceeding regulated norms.

Execution of four foreign consulting packages (TV4/2014, TV5/2014, TVBM-04, TVVD-04) all showed violations.

“The Minister of Health, the Major Healthcare Projects Management Board, and involved units and individuals deliberately flouted bidding laws, splitting packages without a technical, sequential, or project coherence basis, and naming specific foreign consultants in proposals and approvals,” the findings note.

Per the Government Inspectorate, the then-Minister and Management Board “gravely violated the regulations in bidding when determining a pre-chosen foreign consultant".

Negotiations and contract signings also erred; contract values far exceeded norms per the Ministry of Construction’s Decision No 957 (September 29, 2009). Specifically, project planning consultancy contracts were about 5.6 times higher (over VND35.8 billion extra for both projects).

Technical and construction drawing consultancy contract values (with architectural design making up 72 percent) were about 2.3 times higher (over VND69 billion extra for both projects).

As such, total contract values exceeded norm-based estimates by about  VND104.86 billion. Payments that were made exceeded norms by roughly VND80 billion, causing an estimated VND80 billion loss to the state budget.

Vo Thu