Wednesday, August 11, 2010

CAG Report: Irregularities in CWG contracts, names Kalmadi, Fennell and Hooper

The Comptroller and Auditor General of India (CAG) in its interim report says dubious procedures were followed for selecting the consultants for the international broadcasting rights and the sponsorship deal. M/s Fast Track Sales Ltd was chosen as the consultant for broadcasting rights based on just the suggestions of three people - Suresh Kalmadi, Chairman of the CWG Organising Committee, Mike Fennell, President of the Commonwealth Games Federation and Mike Hooper, CEO of the Commonwealth Games Federation. The CAG report also says that there was no detailed technical evaluation of the bidders and that selection was made without 'due diligence'. According to the CAG report, the projected revenue loss from this is
Rs. 24.6 crore.

In the sponsorship deal was awarded to Melbourne-based Sports Marketing and Management (SMAM). The CAG report says the deal was done on a single financial bid. It appears that four parties were interested, but SMAM got a 'sweetheart' deal', where the Organising Committee even agreed to pay an extra comission of Rs. 25.31 crore. That deal has since been scrapped on grounds of 'non-performance', a claim that's been refuted by the Australian firm.

The interim report has also put a question mark on the procedures adopted for the Queen's Baton Relay, held in London last year. That deal went to the highest bidder - Maxxam International. Maxxam bid five times more that the lowest bid, and the CAG report estimates that awarding the contract for the QBR to Maxxam resulted in a loss of Rs. 6.16 crore.

The Organising Committee says the Maxxman was given the contract because the country's prestige was at stake, and the firm had prior experience of handling the event. Reacting to the reports, Commonwealth Games Federation President Mike Hooper told NDTV, "I have not seen the CAG report. I have only seen reports in the media. I will ask the Organising Committee to give us copy of the report, can comment only after that." And responding to the alleged irregularities, Lalit Bhanot, the Secretary General of the Organising Committee, told NDTV, " The enquiry is on, let the results come. Whatever the charges are we will face them all." Bhanot came out in support of terminating the contract with the Australian firm, SMAM, that had been tasked with getting sponsorships. He also said that revenues from the broadcasting deal had doubled, defending the decision to appoint M/s Fast Track Sales as the consultant. Government sources have told NDTV that this is just the interim report, and findings in the final CAG report may vary.


Post a Comment