Latvian State Real Estate (VNI) has presented an announcement in regards to the situation with ongoing reconstruction of New Riga Theatre (JRT) – the request from SBSC for additional advance payment is unjustified.
«By acting this way, the contractor may be trying to unjustifiably acquire state budget funds while also acting dishonestly towards workers, the theatre and society in general,» as mentioned in the press-release from VNI, which is the client of the project.
Following the request from SBSC (composed of Skonto Būve and Skonto Construction) for an additional advance payment of EUR 2.4 million in order to continue the construction process, VNI has asked the company to submit a detailed list with justifications for the advance payment. At an extraordinary meeting of VNI council, the board reported conclusions, including that
the list mentions construction materials worth EUR 1.088 million, which were paid for in June 2022.
After identifying the aforementioned situation, VNI council asked the board to immediately meet with SBSC to prevent repetition of such cases in the future.
The pay for SBSC’s work is paid in full, and, despite Covid-19 and the Russian-Ukrainian war, VNI had previously made decisions to extend construction deadlines and make advance payments. After checking information submitted by the construction company, VNI concluded that
the company failed to pay its subcontractors on time.
This means the SBSC may have acted dishonestly and may have tried to defraud money by presenting unjustified requests, VNI concluded. The state enterprise also reminds that the construction company was told multiple times in the past: there are currently approximately 100 people working at the site, but in order to complete the work on time 240 people would be needed. This much was mentioned by SBSC in its initial plan. However, the company has yet to reach this level of work intensity.
Reconstruction of New Riga Theatre commenced in 2020. SBSC was contracted to do the job for EUR 32.4 million (this includes indexation to counter possible price growth mid-construction).
Also read: Protesting against construction delays, JRT will not produce new performances