Friday, August 03, 2012

George Kent LRT Award: What Says PEMANDU?

What is the point of setting up PEMANDU when the Prime Minister himself tramples on its proposals as he likes, putting to waste hundreds of millions of ringgit in developing, promoting and implementing the Government Transformation Programme (GTP) and the National Key Result Areas (NKRA)

Those who are in the know, would be aware that I have a high degree of respect for Datuk Idris Jala, the Minister in the Prime Minister’s Office in-charge of the “high-powered” Performance Management and Delivery Unit (PEMANDU), especially with regards to his sincerity in wanting to make change happen.  I have at various times criticised policy proposals by PEMANDU, but that is directed towards making them better, and not questioning the intent of those who have worked at drafting the policies.

However, I can only see the sheer hopelessness of the efforts put in by Datuk Idris and his team, when some of these key proposals are given only lip service support.  When it comes to the crunch, many of the policies drafted by the PEMANDU team and its highly paid consultants were either completely ignored or are trampled upon at will by the Prime Minister and his Ministers.

As seen recently, Datuk Seri Najib Razak has shown complete contempt of the PEMANDU GTP programme by repeatedly interfering with the award of the projects for the LRT Extension Programme for both the Kelana Jaya and the Ampang lines.

In June 2011, the Finance Ministry committee had ordered Syarikat Prasarana Negara Bhd to award the deal to the Hartasuma Sdn Bhd-Bombardier joint-venture, whose RM890 million bid is nearly 50 per cent higher than the lowest bid from the Prasarana-recommended Ingress Corp Bhd-Balfour Beatty Rail Sdn Bhd, of RM610 million, the lowest.  The decision was subsequently reversed, and awarded to the Colas and CMC Engineering Sdn Bhd joint venture for RM670 million.

More blatantly, the same committee chaired by none other than the Datuk Seri Najib Razak himself, has overturned recommendations by Prasarana to award the Ampang Line project to George Kent-Lion Pacific joint venture this month.  They have secured the contract for RM1.18 billion despite despite the fact that the consortium had failed both the technical and commercial evaluations for the contract.

What is beyond belief is that George Kent is a manufacturer and supplier of “control instrumentation, telemetry, pipes, valves and fittings, industrial and domestic water meters, boilers”, as well as “the manufacture of fibre glass reinforced polyester (FRP) panel tanks for bulk water storage” can be qualified for a billion ringgit LRT project. George Kent made only net profits of RM19.3 million on revenues of RM152 million for the financial year ended January 31, 2012.

PEMANDU has in its GTP paper clearly stated that “we will reduce leakages of funds allocated for national development and operational expenditure and ensure transparency in the award of contracts” and admitted that “currently the public perceives that there is a lack of transparency in our procurement processes.”

PEMANDU also wrote that “it is well established that transparency is crucial for a fair and efficient government procurement process. This is because transparency increases public scrutiny on the procurement process and helps ensure that accountability and well-defined policies, regulations and procedures have been put in place and followed closely.”

However, as shown in the above 2 LRT contracts, what PEMANDU proposed mattered little to the Prime Minister, who also holds the position of the Finance Minister.  It is clear that PEMANDU’s role in the Najib’s administration is to present a façade of reformist credentials for the BN Government and to act as apologists for his failure to implement any tangible reforms.

As at June 2011, PEMANDU has spent RM27.5 million on “communicating” the GTP and ETP to the Malaysian public and another RM36.9 million running dozens of labs led by various consultants.  The above forms only part of the overall NKRA operating budget of RM334 million in 2010.

Instead of spending the money to bring about real transformation by improving transparency, accountability and integrity, hundreds of millions of ringgit are wasted on thousands of pages of plans and presentations, dazzling publicity drives as well as half-hearted implementation efforts to present a semblance of reform to the general public.

If the Prime Minister is in reality going to ignore GTP and award contracts directly to his own preferred vendors regardless of the “open tender” outcomes, then he might as well save the people the hundreds of millions of ringgit spent on the dog-and-pony PEMANDU show.
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