Exposed - Open Tenders Pre-empted
 
 

Exposed!

OPEN TENDERS PRE-EMPTED FOR SPEEDY AWARDS OF PROJECTS TO CRONIES

An Election-Driven Economic Recovery Plan
 

The PM had on many occasions over the past few months called for an increased tempo in the construction industry. Is this really to revive and revitalise the economy as he claims it to be or is it part of an impending election strategy?

The general election is looming just around the corner and huge funds are desperately needed for the election campaign? After all, the PM has openly stated that this election is going to be the dirtiest of all elections - therefore that much more funds would be needed to fight the opposition.

The construction industry has always been the main provider of such campaign funds in the past elections. It is a known fact that a lot of construction projects, including the North-South Expressway, were handed out to friendly contractors who were willing to play the kick-back game involving millions and billions of ringgit going into the political parties kitties, enriching a few individuals along the process.

The construction industry must continue to play that role for the forthcoming election and the PM and UMNO have to activate enough major construction projects to generate the funds.

Cronyism

At the recently concluded UMNO General Assembly, the leaders openly condemned cronyism and called for a transparent form of government. UMNO even decided to publish in public the list of Bumiputras allocated shares in a number of firms. It is doubtful as to whether these people are really the majority owners - does not seem to be so, looking at the number of shares held by these Bumiputras. The real owners and beneficiaries could be
the PM's cronies camouflaged behind some nominee shareholders.

Can UMNO really eliminate cronyism, especially now with the election campaign trail already picking up pace? What easier way to collect the campaign funds than by awarding huge government projects and contracts to the cronies.
 

Major Projects Awarded Without Tenders

It was reported recently that the Government is planning to award the construction of more than 600 schools. What may not be known to the public is the fact that the jurisdiction to award these school contracts was snatched away from the Works Ministry and given to the Finance Ministry, headed by the Tsar himself, Tun Daim Zainuddin. And apparently under the pretext of the urgent need for more schools, all these school contracts are being awarded without any tenders - only direct negotiations with the Finance Ministry with Tun Daim having the final say. It will be interesting to know who are the lucky contractors, the lucky cronies. Do you call this the Transparent Government?

The list of many more major construction projects being dished out by the Government without tenders seems to be increasing as the election approaches. The open tender system has been totally pre-empted. Some of the more recent projects include:
 

* Upgrading of Banting - Sabak Bernam Road

* Double tracking KTM line from Rawang to Ipoh

There is hardly any publicity on the award of these projects. Transparency and accountability definitely does not seem to be the criteria for these Government contracts.

South Klang Valley Highway (SKVE)

This highway was privatised and awarded to Gadek/ DRB-Hicom some time back. On the pretext of an urgent need for a link from the KL - Seremban Highway to Putrajaya, the Government is planning to take away a priority portion of the SKVE from Gadek and award it to MTD/UEM without any tender. Gadek protested vehemently, arguing that it should be tendered out for competitive pricing. The Government, as expected, turned a deaf ear.

East Coast Highway  - An Empty Promise

The latest project that has captured the PM's and Daim's interest is the East Coast Highway Project. This highway was promised by the Government at the last election but there is no sight of it after 5 years. The Pahang and Terengganu governments and the people have been eagerly waiting for this highway to open up and develop the East Coast states. They see greater socio-economic benefits from this highway compared to all the other urban tolled highways. Do these people have to listen to yet another promise this election?

East Coast Highway - A New Agenda for this Election

Finally it was reported that the Project was privatised and awarded to Malaysia Mining Corporation Bhd (MMC) but MMC is not allowed to proceed with the project apparently because the government is doubtful of its financial capacity. This is a bit strange when MMC is majority owned by PNB, with billions of ringgit collected from Unit Trust investors. It was also reported in the media not so very long ago that MMC is disposing off its foreign investments and repatriating as much as two billion ringgit into Malaysia.

Has the government or more specifically the PM (or Tun Daim) got some other agenda? It is beginning to seem so. Instead of allowing MMC to proceed, the government (through the PM's Department) is now planning to instruct MMC to award the whole of the construction contract to MTD Capital without any tender. What a daring move. Isn't it strange for MMC, a major cash cow to fund the project whilst MTD walks away with a lucrative no-risk construction contract worth almost a whooping RM 3 billion upfront?

This is the first time in the Malaysian privatisation history where the Government is nominating the contractor to a Concession Company, a new condition precedent to be fulfilled. This is also the first time in Malaysia that a RM 3.0 billion construction contract is awarded without any tender. Ironically, MTD's records show that they have never carried out such a mega-project within a short-time frame.

The Government has yet again pre-empted the open-tender system for award of ontracts. Is this the transparency that the Government is promoting? What is the Government's agenda? Can MMC object to this scandalous arrangement given that its majority owner PNB is Government controlled?

Bumiputra contractors and suppliers, big and small, and many from the East Coast states were having high hopes of participating in the construction works. All their hopes will be dashed with the Government's latest move.

Why MTD?

It is widely known that its founder and Chief Executive, Dato' Nik Hussein, is also the UMNO Kelantan Treasurer and a very close friend and ardent supporter of the PM. It is well known that numerous road construction projects have been awarded to MTD without any tender, just direct negotiations. What better timing than now to give Dato' Nik a few more, that too, much bigger ones? The elections are around the corner and UMNO will try all out to regain Kelantan. The PM has already set the motion by appointing Tengku Razaleigh as the State UMNO chief. All he needs now is the funds. Looks like a lot of it will come from MTD.

News has also being spread around that the PM is trying to help Dato' Nik resolve his financial problems due to a major cost overrun on the recently completed KL - Karak Highway. The PM needs him for Kelantan. Another bail out.

As far as the PM is concerned it is "Long live cronyism" whilst "Transparency" is for the birds.

Thanks & kindest regards
 
Raja Petra Kamarudin