CDA loves to restrict auction

ISLAMABAD, Sept 13: Just weeks after the prime minister blocked their auction of commercial plots to pre-qualified bidders, the Capital Development Authority bosses plan to go ahead with the practice.

Dawn has learned that the CDA bosses have agreed to auction eight sites for petrol stations – of estimated value of Rs7 billion – through the same process. These prized sites are on the extension of Blue Area in F-10, along Shahrah-i-Iqbal skirting E-9, E-10 and F-11. Two sites are located in G sectors.

Only 13 days ago, on August 31, Prime Minister Pervez Ashraf had communicated to CDA that his government will not compromise on transparency and blocked the sale of 12 high value commercial plots to 11 pre-qualified bidders, that drew criticism that the pre-qualification system works for the powerful investors who can dictate lower prices through their connections in right places.

“These sites for petrol stations can fetch CDA better price through open auction,” insisted a CDA officer who did not want to be named.

It was “an established fact” that pre-qualification of bidders is designed to help the mighty tycoons and powerful businessmen and developers who can manipulate the bidding processes without the fear of being exposed, he claimed.

CDA chairman Farkhand Iqbal however has reasons for favouring the pre-qualification process.

Pre-qualification of bidders is an approved method, allowed by the government and practised to get strong business leads,” he told Dawn.However, he added that “the final decision (about employing this method in the auction of petrol stations sites) is still to be taken”.

About the prime minister’s action of cancelling the auction deals done last month through the pre-qualification process, the CDA chairman said: “I have no issues with open auctions, but I insist that pre-qualification bidding brings serious buyers and they pay you the promised amount.”

In 1980, he said, a successful bidder failed to pay the promised amount for a commercial plot. Still he took the CDA to the court for refusing to honour the auction deal. The court granted him relief and the plot is in limbo to this day, he said.

“Pre-qualification bidding is always helpful. The process gets us the promised bid money as per the payment schedule,” said the CDA chairman.

“Give us some time. We will make the bidding process transparent and hold open auction. But that will need the consent of our Board,” he concluded.

Source: http://dawn.com/2012/09/14/cda-loves-to-restrict-auction/