Toward the end of the study into the Municipal Development Project, it became obvious that the International Operator had not only been misappropriating project funds and embezzling state funds at every possible opportunity; he had been abusing the Yerevan water system by pumping up the water pressure. The Operators reasoning was that the water company would be able to eliminate Yerevan’s system of 795 Booster Pumps, which would save the hundreds of thousands of dollars the company pays each year for the electricity to run the pumps.
But the small benefit that might have been gained from eliminating the Booster Pumps paled to insignificance when compared to the enormous problems the increased water pressure created. There was a four-fold increase in catastrophic pipeline failures, which caused intolerable water outages. The incessant pipe failures resulted in regular flows of mud and water over Yerevan’s roads, and the constant road repairs caused havoc throughout the city. The Head of the State Water Committee eventually announced that more than four hundred million dollars would be needed to replace Yerevan’s entire water pipeline system.
This was obviously a nonsensical approach; more a ploy to make more illicit gains than to solving Yerevan’s water problems.
So the Commissions Senior Specialist, who had managed the study, in an attempt to limit the irresponsible abuse of the Yerevan water system, lobbied the Armenia State Water Committee, the Director of the PMU and the World Bank, to have the pipeline pressure reduced to the original specification pressure of 2 atmospheres, and to introduce a program to upgrade Yerevan’s system of Booster Pumps, so that they would work more reliably and more efficiently.
It was agreed that the Spitak Development Association, the fund for which the Commission specialist had worked as Project Director, and which had released him for a year to work for the Parliamentary Commission, would develop a Booster Pump project. The objective was to demonstrate that modern, efficient Booster Pumps could deliver ‘Round-the-Clock’ water and use no more electricity than the original pumps, which typically operated for between 4 and 8 hours each day.
In January 2005, the Spitak Development Association submitted an initial proposal to the Director of the Municipal Development Project Management Unit and to the World Bank. At this time, the Municipal Development Project was nearing the end of its extended period, due in May 2005, and there had been absolutely no plan to upgrade the booster pumps. To the contrary, the International Operator was still pressing to increase the pipeline pressure and to eliminate the old and often dilapidated booster pumps.
After numerous meetings, in June 2005, Mr. Andronik Andreasian, the new Head of the State Water Committee, approved a Pilot Project for the Spitak Development Association to produce and install a small number of the new Booster Pumps. Mr. Andreasian added in his Letter to the Spitak Development Association that the State Water Committee would support applications for grant funding for the project and he would seek to obtain the appropriate Government co-funding.
Shortly after that meeting, it became known that Walkling, who was now working as consultant to the new Yerevan water company director, had secretly arranged the purchase of 50 new booster pump units, using Municipal Development Project funds which had been assigned for general machinery and equipment purchases.
By October 2005, the Spitak Development Association had produced three new Booster Pump Units (BPU’s), which were installed at three locations in central Yerevan. In February 2006, the Director of the Yerevan Water & Sewerage Company wrote to the Head of the State Water Committee, confirming that the new Booster Pumps, working ‘Round-the-Clock’, used less electricity than the original pumps, which operated for 4 hours each day. The Head of the State Water Committee wrote to his Minister recommending full project implementation.
Between February and December 2006, the Spitak Development Association sent numerous letters to the World Bank in Yerevan and in Washington, reporting on the excellent results of the pilot Booster Pump Project, but the Bank did not answer any of the letters.
In May 2006, Veolia started the new World Bank financed water project for Yerevan. So, starting June 2006, the Spitak Development Association made many applications to Veolia to discuss the Booster Pump Project and explain how the water company could have its entire system of booster pumps replaced by new, reliable and efficient pumps, which would not only provide ‘Round-the-Clock’ water but would reduce the electricity expense by hundreds of thousands of dollars each year. Moreover, a number of donor organisations, including the USAID, had expressed that they could finance the project, assuming agreement could be reached with the international operator, and that meant the Yerevan water company would get their new booster pumps Free Of Charge!
But throughout the entire period to the end of 2006, it was not possible to meet with either Veolia’s General Director or Operations Director. In January 2007, Veolia’s General Director announced that Veolia would be installing 500 new Booster Pumps for the Yerevan Water company. Moreover, Walkling, who had been at the center of wide-ranging corruption through his management of the Municipal Development Project, was appointed to manage the project.
This was a typical example of how the World Bank operates its ‘Level Playing Field’, by simply ‘Brick-Walling’ those outside the inner circle.
It was after hearing that Walkling was to implement the Booster Pump project that the Spitak Development Association had written, piloted and gained approval for from the Head of the State Water Committee, that Mr. Tasker, the Specialist who managed the Parliamentary Commission study into the Municipal Development Project, forwarded commission study documents to the Government Accountability Project (GAP) in Washington, and asked their support to a claim against the World Bank. GAP receives thousands of such requests each year and is able to actively respond to only a very small number.
GAP’s lawyers studied the documents for a period of three months, and on the 29th March 2007, GAP’s general Council submitted a ‘Demand Letter’ to Ms. Suzanne Folsom, Director of the World Bank’s watchdog organization, the Department of Institutional integrity (INT), requesting an investigation into Mr. Tasker’s claims of corruption associated with the Municipal Development Project, and into his claim that he had been ‘Blacklisted’ by the World Bank.
Details of that claim will shortly become available through this blog.
And as a matter of interest, there are signs that today VEOLIA may again be pumping up the pressure!
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