No solid justification in awarding RC/VEP project through direct nego — PAC

No solid justification in awarding RC/VEP project through direct nego — PAC
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KUALA LUMPUR (Nov 10): The Public Accounts Committee (PAC) has found that there was no solid justification for TC Sens Sdn Bhd to be awarded the Road Charges (RC) System and Vehicle Entry Permit (VEP) project totalling RM149.45 million through direct negotiation between 2016 and 2018.

The project involved two contracts, namely the Capital Expenditure Contract (CAPEX) worth RM45.15 million inked on Sept 14, 2016, and the Operational Expenditure Contract (OPEX) worth RM104.30 million inked on May 7, 2018.

PAC chairman Wong Kah Woh said the awarding of the project through direct negotiation under the Transport Ministry (MoT) failed to achieve the original objective, which was to expedite implementation of projects required by the government.

“The selection of TC Sens Sdn Bhd was presented to the then Prime Minister without comprehensive and in-depth assessment of the company’s financial and technical ability to carry out the RC/VEP project,” he said in a statement today.

Wong said there was also political influence in the appointment of the contractor or vendor for the project.

“The RC System and VEP project was a project under the MOT with the Road Transport Department as the implementing agency. The system was mainly installed at the Customs, Immigration and Quarantine (CIQ) Complex in Bangunan Sultan Iskandar and Sultan Abu Bakar Complex, Johor,” he said.

Wong said some weaknesses were found in the administration and implementation of the contract, namely a 16-month delay in signing of the contract, payments were made before the Final Acceptance Test (FAT) was completed, and the appointment of a third party in the implementation of the project was made without the approval from the ministry.

“The RC/VEP project was delayed. Three Extensions of Time (EOT) were approved for system integration requirement and the role of the contractor as a vendor and not a competent solution provider have also contributed to the delay,” he said.

Therefore, he said the PAC has recommended several measures to the government, including that the Finance Ministry must ensure that all future direct negotiation decisions must have solid justification.

He said enforcement agencies including the Malaysian Anti-Corruption Commission (MACC) must pay attention to PAC’s conclusion and investigate accordingly.

“Members of Parliament must declare the importance of business to the relevant ministry if the business involves government projects.

“The government must ensure that there would be no exemption given to any project which must undergo the evaluation process through committee at the ministerial level including the Value Management Lab and MAMPU’s ICT Technical Committee,” he said.

Following the findings reported in the Auditor-General’s Report 2017 Series 2, which was tabled in Parliament on Dec 3, 2018, Wong said the PAC had initiated proceedings on this issue calling Datuk Mohd Khairul Adib Abd Rahman, the then MOT secretary-general on Feb 20, 2019, followed by former Transport Minister Datuk Seri Liow Tiong Lai on March 27, 2019, and former MOT secretary-general Datuk Seri (now Tan Sri) Dr Ismail Bakar on April 3, 2019.

“On Sept 3, 2019, the PAC called former Tanjung Piai MP Datuk Seri Wee Jeck Seng on his involvement as a shareholder of TC Sens Sdn Bhd. The PAC later called the company’s chief executive officer Tan Chean Suan on Oct 23, 2019,” he said.