World Bank retaliates against Parliamentary Whistleblower

World Bank retaliates against Parliamentary Whistleblower

Thursday, December 13, 2007

Armenia’s Watergate Continues

Translated from 168 Hours newspaper article of 13th December 2007

Two days ago, the Armenian Yerevan Water Company announced that, starting 12th December, between 12 noon and 6.00 pm, water will be cut off in the center of the city, apparently because the electricity company has switched off the electricity to the Garni water pumping station.

Of course, this is a sufficiently regular kind of occurrence for Armenia, so it is not of great importance that the water is switched off for a period of six hours each day. But what is of interest is why the center of Yerevan will be without water, and the news would not have drawn our attention if we had not remembered one factor.

Within the Municipal Development Project of 2000 to 2005, the Garni pump station that provides water to the center of Yerevan should have been removed and the system converted to gravity feed, to reduce the amount of electricity used by the water company. The pump stations that provide water to the city use valuable electricity and that is why the Yerevan water company, year in and year out, accumulates massive debts for the electricity it uses. One of the more important projects within the Municipal Development Project was to convert the Garni pump station to gravity feed, but the work was not done.

If that work had been done, not only would the water company be paying less for its electricity, the reliability of the water supply from Garni would have been improved and today Yerevan’s city center would have water. With regard to what needed to be done, contrary to information from A. Utilities, the International operator, that work started in the Soviet times. The excavation works were done and sections of the pipe works were installed. But the work was left incomplete, so the project was newly documented as a Municipal development Project initiative.

The Parliamentary Commission study of 2004 found that three payments were made for this work; $245,000, $87,000 and $81,000. But the payments were not only made to convert the Garni pumping station to gravity feed, at the same time they were made to refurbish the station that was no longer to be used. According to Tasker, the Commission’s Senior Specialist, he had arranged a site trip to inspect newly installed water pipes, so at the same time he requested a trip to Garni to inspect the pump station by-pass work that A. Utilities had informed the Commission had been completed. On the way to Garni, Mr. Petrossian, the specialist provided by the water company, confirmed Walkling’s assertions that the water from Garni already flowed to Yerevan under gravity. But on arrival at the Garni pumping station, which is down in the river gorge, it was seen that the work had not been done and the pumps continued to operate. So today we ask the question; where did that money go?

Moreover, if the pumping station was to be eliminated and the water was to flow under gravity, why did the company need to spend large amounts of money purchasing materials and equipments to refurbish the station?

This was one of many A. Utilities priority project activities where documents show how large amounts of money had apparently been expended, but where the work was not done. But added to that, not only was the water supply not converted to gravity, the refurbishment of the pumping station only amounted to a lick of paint to the pumps and pump motors.

According to technical data submitted to the Commission, the Garni pump station has a total electricity consumption of 169 Kilowatts. Taking into account that the pump station may not operate all day long, each month the electricity account for the Garni pump station will be in the region of six thousand dollars. This is one of the points highlighted in the packet of documents that GAP submitted to the Bank’s Department of Institutional Integrity in March this year.

Water Pipes for Advertising Hoardings

Coming back to the site trip to verify where old corroded water distribution pipes had been replaced by new; A. Utilities submitted documents to the Parliamentary Commission showing that more than four million dollars had been spent to purchase a variety of diameters of steel pipes for the Municipal Development Project. Richard Walkling, Authorized Representative of A. Utilities, and doubling as General Director of the Yerevan water company, submitted six project documents to the Commission, detailing where the pipe replacement work had been completed. But when asked for the documentary evidence to show that the pipes had actually been used for those projects, instead of providing contracts, Walkling submitted a ledger of works orders that provided details of emergency repairs. The Commission lawyer studied the documents and deemed them all to be falsified or counterfeit. That led to the site visit, to visibly verify that the pipes had actually been installed. But Walkling’s specialist declined to take Tasker to any of the sites, explaining that the pipes were already under ground and could not be seen. A request to look into manholes, to visibly inspect the ends of the new pipes was also refused. Out of six projects, A. Utilities could not show one that had been implemented.

According to Tasker, further inquiries revealed that the pipes purchased for the project were not used for the purpose intended. According to the Armenian security services, they had been used for other purposes. For instance, they were used for the frameworks and stanchions of advertising hoardings, which at that time sprang up throughout the city, promoted by the town mayor’s office, and coordinated by the chief city architect, Nareg Sarkissian. The larger diameter pipes were used for the stanchions and the smaller diameters for the frameworks. In that way, the pipes were not used to replace old water pipes as intended, but by all accounts with the help of the mayor’s office, were diverted to alternative profit-making ventures.

So today those pipes are not laying horizontally under ground providing reliable and consistent water to Yerevan’s water subscribers, they are vertically inclined above ground, making profits for the advertising agencies. Of course, the various organizations in the water sector must have known about this activity, including the State Water Committee, headed by Gagik Martirossian, the Project Management Unit, Director Varazdat Avoyan, and including the credit provider, the World Bank, who’s Country Manager was then Roger Robinson.

Yet another credit not used for the purpose intended, to be accounted for by the next Armenian authorities, paid with public funds collected from Armenia’s future generations.

Armine Avetisyan

168 Hours reporter

No comments: