A contract worth 11 billion tenge for the maintenance of road infrastructure in Astana has been extended for a year without a tender, reallocating unspent 4.3 billion tenge instead of returning it to the budget. The contract includes services for switching on and switching off the heating in CCTV camera cabinets, and the installation of road signs is carried out without tenders. The editorial team at FBRK decided to investigate how the public procurement system in the capital's transport safety sector operates.
In August 2023, the Department of Transport and Development of Road Transport Infrastructure of Astana entered into a government contract with LLP "SMEU Astana" for a very substantial amount — over 11 billion tenge. Incidentally, this company holds the dealership rights for supplying a significant portion of road equipment in the region, a company whose activities our editorial team has already written about on several occasions.
Officially, the contract covered the current repair and technical maintenance of road safety equipment, including the intelligent transport system.
Initially, it was planned to spend 350 million tenge in 2023, then nearly 6.6 billion in 2024, and just over 4 billion in 2025. The contract was supposed to end at the close of 2025, but over its duration, the document was amended a total of seven times. Annual amounts were adjusted, but the total value of the contract remained the same — until the seventh amendment.
In the latest supplementary agreement, instead of logically concluding the contract and returning unspent funds to the budget, the contract period was extended to 2026, and the 4.3 billion tenge not used within the originally set timeframe were simply reallocated to the additional period.
Such a generous gesture raises legitimate questions. If nearly 40% of the total contract amount was not required, how was the budget even planned? And who made the decision to extend the contract instead of announcing a new tender, as required by law?
The content of the contract itself is also interesting. Among other services, there are items such as switching on the heating system in the CCTV camera equipment cabinet and switching off the heating system in the CCTV camera equipment cabinet. Apparently, in the capital, they consider flipping a switch to be a high-tech operation worthy of a separate line item in a multi-billion contract. There are plenty of similar services in the document, by the way.
The situation in the capital regarding road signs, whose maintenance is also included in the contract, is no less interesting. According to information from our sources, the Akimat insists that such tenders are not held, and that the installation of signs is supposedly part of general construction contracts, and statistics on installed signs are 'not compiled in a consolidated form'. Meanwhile, signs appear in the city regularly, as do orders for their installation.
So who exactly is installing and maintaining the signs on the streets of the capital if the Akimat fundamentally does not hold tenders for these services? We can assume that the installation of road signs is carried out within the same budget allocated for their maintenance. This is likely done to avoid announcing a tender and to ensure that one specific company receives additional volumes of work without any competition.
During the contract period, the number of traffic signal installations and signs in the city is growing, and in the next tender, the amount will surely increase to cover all 'unforeseen' expenses.
Such cooperation clearly suits both sides: officials are spared excessive paperwork, and contractors are spared competitors. The result is a system where everyone gets their dividends, and citizens foot the bill for switching heaters in CCTV cabinets on and off.
The editorial team at FBRK has repeatedly covered similar schemes in various regions of the country. For example, we wrote about how much the status of Kosshy city cost and how the local Akimat's spending on maintaining road infrastructure increased from 1.4 million to 595 million tenge in just a few years. Incidentally, all with the same company - LLP "SMEU Astana".
Furthermore, we reported on how spending on road infrastructure is growing in Kazakhstan and how the lack of transparency in public procurement leads to projects becoming many times more expensive.
One can only hope that the regulatory authorities will finally pay attention to how billions of tenge of taxpayers' money are being spent. And find out whether the service of switching on the heating in a cabinet is really worth such money, or whether it is simply a convenient way to justify astronomical sums in government contracts.