I had yesterday issued a press statement on the cost of the new KLIA2 “low-cost” airport terminal which saw an increase in expenditure from an initial budget of RM1.7 billion to RM3.9 billion based on the “reply” by the Minister of Transport, Dato’ Seri Kong Cho Ha in Parliament.
I had requested for an explanation from his ministry over the issue, particularly over the reason for the shift of the airport from the originally proposed northern site (KLIA North) to the current western site (KLIA West) which is under construction. The shift of the site has caused the cost of construction to bloat because KLIA West was already identified as unsuitable for the construction of an airport due to it being a peat swamp.
The result of the shift for example, has caused substantial increase in earthworks cost, which the Ministry of Transport claimed to cost RM773 million, but is believed by many parties in the industry to be even higher.
However, despite the seriousness of the mismanagement of public funds, Dato’ Seri Kong Cho Ha has refused to provide any details in his parliamentary reply, and merely shrugged off the issue claiming that the decision to shift the site was “based on KLIA Blueprint December 2008”.
The Transport Minister has responded to my statement yesterday by saying that I was “playing politics” and was “barking up the wrong tree” (The Star).
Dato’ Seri Kong said I “should direct questions about the construction of KLIA2 to Malaysia Airport Holdings Berhad (MAHB) instead of accusing him of trying to cover up.” He had further added that he has “nothing to hide. I'm not an airport engineer or consultant for the project and whatever the information I have about the project were given by MAHB.”
His response has proven his sheer incompetence and absolute lack of accountability in ensuring that public interest directly under his purview is fully protected. How can a Minister plead ignorance over a RM3.9 billion scandal right under his nose?
The Ministry of Transport is fully represented in the Board of Directors of MAHB by none other than its Secretary-General Dato’ Long See Wool. He is also joined by Dyg Sadiah binti Abg Bohan, who is the private secretary to the 2nd Finance Minister.
The Ministry of Transport, as the regulating agency for the airports and aviation industry must surely be competent enough to know why MAHB was allowed to shift the airport from KLIA North to KLIA West, resulting in massive cost overrun.
Is Dato’ Seri Kong Cho Ha claiming that the Secretary-General of his Ministry is sleeping on his job and has no clue over the underlying reason for the cost explosion over the KLIA2 project? Or do they think that the amount of money is so trivial that it doesn’t necessitate a full audit and bring to book those who have been negligent, intentionally or otherwise?
As a result, the MAHB had to raise RM3.1 billion in debt in 2010, and a further RM598 million this year via new share placement to fund the massive increase in cost. There is no doubt that public interest will be compromised as MAHB is owned by Khazanah Bhd (54%), Employees Provident Fund (10.3%) and Amanah Saham Bumiputera (ASB) (6.8%).
In addition, given the outrageous increase in cost, there is no doubt in anyone’s mind that airport taxes will have to be increased at some point in the near future to ensure MAHB’s commercial viability. Such increase in taxes will not only be a burden to ordinary Malaysians, but also have a negative impact on our goal to be a competitive aviation hub in the region, especially in the low-cost budget carrier industry.
The Prime Minister, Dato’ Seri Najib Razak must immediately admonish his Transport Minister for completely lacking the necessary “people first, performance now” attributes and demand that Dato’ Seri Kong be accountable for his Ministry’s duties, or he should be removed from his position.