Sherab Lhamo

A recent audit report has uncovered a series of financial and quality control issues in the project by the Department of Air Transport (DoAT) under the Ministry of Infrastructure and Transport.

The Royal Audit Authority’s (RAA) annual report 2022-23 revealed that the DoAT failed to reimburse Nu 19.086 million from the Asian Development Bank (ADB)-funded project “Air Transport Connectivity Enhancement” for pre-financing activities covered by the Royal Government of Bhutan (RGoB) fund.

The DoAT made unjustified payments amounting to Nu 3.07 million due to a lack of proper rate analysis for change in construction materials.

The RAA has recommended that the DoAT conduct a detailed rate analysis to determine the actual cost difference and recover the excess amount paid.

DoAT also made an overpayment of Nu 757,000 to a contractor due to a miscalculation in the price adjustment clause. While the excess payment has been recovered, the DoAT has not yet taken disciplinary action against the officials responsible for the error.

The ADB funded project aimed to improve infrastructure for Bathpalathang (Bumthang), Gelephu, and Yonphula domestic airports, to expand initial developments undertaken by the government.

The DoAT had also accepted substandard work, including defective ceiling boards, flooring, and other elements at the Bumthang Domestic Airport terminal building.

The RAA also found that DoAT had failed to withhold a payment of Nu 160,000 from the contractor, Rinson Construction Private Limited, for not submitting required “as-built” drawings, a contractual obligation.

The RAA has recommended that the DoAT to obtain these drawings from the contractor.

The department neglected to renew a performance guarantee of Nu 5.987 million, as stipulated in the contract for the runway end safety area (RESA) project at Yonphula Domestic Airport, awarded to Norzang Construction Private Limited. The performance guarantee expired in April 2023 without the completion of the work.

The RAA recommended DoAT to renew the performance guarantee to safeguard against associated risks.

In response, DoAT officials said that the contractors were already notified about the audit findings, and the rectification had been completed from contractor’s end, as the contract includes a one-year defective liability period.

A DoAT official also confirmed that the action taken report has been shared with the RAA.

“The action taken is intimated to the audit and settlement of ongoing observation to address the identified issues and prevent similar occurrences in the future,” said the official.