by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Petaling Jaya on Tuesday,11th February 1992:
DAP calls on the Federal Government and all State Government to abolish th system of negotiated tender, which is the source of corruption, abuses of power and malpractices, and replace it with open tender
The explanations yesterday by the Trengganu State Government Tender Board have not fully rebutted and laid to rest the allegations by the Trengganu branch of the Malaysian Bumputra Contractors’ Association (PPBMT) of hanky-panky in the award of state government contracts and privatisation projects.
The Trengganu State Tender Board Chairman, Datuk Haji Abdul Rahman Nasir, who is also the State Secretary, said from 1983 to 1991, the State Government had, through the Public Works Department, awarded only 23 contracts to Seri Terukon out of 732 contracts approved.
The value of contracts awarded to Seri Terukon was $115.6 million or 16.35 per cent out of the total contract value of $706.7 million.
The figures given by the Trengganu State Tender Board can be challenged on two grounds.
Firstly, a very different picture of a monopoly position by Seri Terukon could emerge if instead of going back to 1983, when Seri Terukon was first formed, figures are given for the government contracts and privatisation projects awarded for the past two, three or four years.
What the Trengganu State Tender Board should have done to clear all public doubts on this matter is to give a year-by-year breakdown of the contracts and privatisation programmes awarded since 1983, for this will then give a fair and accurate position with regard to the allegation of the PPBMT about the monopoly of Seri Terukon in Trengganu.
Secondly, the $115.6 million for 23 contracts awards to Seri Terukon since 1983 referred to the original contractual costs, but do not include the V.Os or variation orders, which could radically alter the original costs. One example is the construction of the Istana Trengganu in Kuala Lumpur, which shot from the JKR estimate of $5.9 million to $13.6 million after taking into account all the ‘Variation Orders’.
It is clear that one root cause to the controversy over the award of Trengganu government contracts and privatisation projects is the system of negotiated tender, which is a fertile source of corruption, abuses of power and malpractices, for it is not subject to the checks and balances necessary to hold a democratically-elected government to account.
To ensure that the tender system is one which encourages a ‘clean, honest and efficient government’, DAP calls on the Federal Government and all State Governments to abolish the system of negotiated tender and replace it entirely by the system of open tender.
Trengganu Mentri Besar cannot fully clear his name unless he institutes public inquiry for an independent panel to examine all the allegations of PPBMT
The PPBMT had made very serious allegations against the Trengganu State Government which had been headed by Tan Sri Wan Mochtar for 18 years.
The Trengganu Mentri Besar should realise that he must bear full political responsibility for these allegations, and that he cannot fully clear his name unless he institutes a public inquiry for an independent panel to examine all the allegations of PPBMT.
The Prime Minister, Datuk Seri Dr. Mahathir Mohamed, had asked the PPBMT for proof of palace involvement in the award of Trengganu State Government contracts and privatisation projects.
In view of the fact that is now the fashion of some political leaders to indulge in ‘Istana-bashing’ at the UMNO General Assembly, it would be most unfair to the Rulers not to get to the bottom of the PPBMT allegation of palace interference in the award of contracts and privatisation projects to Seri Terukon. This is why a public inquiry would be the most ideal vehicle whereby the Palace can rebut the PPBMP allegation of palace interference in the award of contracts and privatisation projects.
The issue as to whether Seri Terukon is the ‘royal contractor’ in Trengganu as alleged by the PPBMP must also be publicly dealt with in the public inquiry, so that the people can know definitively whether it is true or false.
There must also be a full inquiry as to whether a ‘Kapitan Cina’ is involved in the palace interference in Trengganu, as has been suggested in the press controversy. This is a very serious allegation because if such allegations are allowed to be made freely and wildly, it would poison Sino-Malay relations and cause grave damage to the nation-building process.
When the Seri Terukon controversy was first made public, the PPBMT alleged that 49 per cent of the equity of Seri Terukon was owned by non-bumiputeras, and there were allegations that this constituted a serious ‘economic encroachment’ of bumiputera economic interests.
The managing director of Seri Teukon, Datuk Yusuf Mohamed, has said that 80 per cent Seri Terukon Sdn. Bhd. are owned by bumiputeras.
What are the true facts?
The PPBMT said in a statement yesterday that the memorandum was sent to the Prime Minister more than two month ago. However, Dr. Mahathir said after the UMNO Supreme Council meeting yesterday that he had yet to read the memorandum of PPBMT.
Something seems to be very wrong somewhere, which reinforces the case for the establishment of a public inouiry to get to the bottom of the PPBMT and Seri Terukon controversy.