Tan Sri Dr Mohd Irwan Serigar Abdullah was appointed chairman of TRX City Sdn Bhd and Bandar Malaysia Sdn Bhd
PUTRAJAYA: All tenders related to government projects are still subject to review by the Ministry of Finance’s (MoF) procurement committee before being awarded, said Treasury Secretary-General, Tan Sri Mohd Irwan Serigar Abdullah.
He said this was irrespective of whether the contracts involved open tenders, direct negotiation or limited tenders, and regardless of which minister or the Prime Minister signing off on the approval for the project.
“It will be the committee’s decision. We will evaluate the tender as to the cost and if the company is qualified, as well as the technical viability.
“So, even if there is a letter with the Prime Minister’s signature or minister’s directive, it still goes to the committee and we will follow the standard operating procedure,” he said during a question-and-answer session with the media on the Auditor-General’s Report 2016 First Series in Putrajaya on Thursday.
Mohd Irwan was asked if the Government intended to limit direct tenders after the report highlighted several delayed projects such as the Bera Hospital in Pahang.
The report, tabled in Parliament on Monday, urged the Public Works Department to appoint a reliable new contractor to complete the construction of Package 2 of the Bera Hospital and the urgent appointment made to ensure the existing structure of the building did not suffer from material deterioration.
Replying to a question, Mohd Irwan said: “We will go for direct negotiations to save time, cost and enhance efficiency. But direct negotiations have been decreasing in percentage. We are now going more for open tenders.
“Last year, 59.57% of government contracts were awarded via open tender and only 39% were through direct negotiation. The balance 1.2% was awarded through limited tenders.”
Asked why government revenue fell from RM219bil to RM212bil, he said it was due to the sudden decline in oil prices in 2014, 2015 and 2016, and the Government was still dependent on oil revenue then.
“When the Government introduced the goods and services tax (GST) in 2015, we succeeded in collecting RM42.6bil. While many criticised the GST, if not for it, the country could have gone bankrupt.
“If anyone says the GST can be abolished, then the country will be in a lot of trouble. The fall in revenue was due to oil, but we believe in diversifying the economy.
“In 2014, we were dependent on oil, at almost 41% of government revenue. But when we implemented the GST and undertook a lot of rationalisation, the dependence on oil dropped to just 14% at present. That is the government’s success,” Mohd Irwan added.
He also said the Government had undertaken a number of cost saving measures in respect of expenditure and succeeded in savings of about RM5bil.
“So, we will retain the GST at 6%, but will make a lot of changes in respect of the tax collection.
“Now, we are checking if those companies which had requested for an exemption from the Inland Revenue Board have fulfilled key performance indicators in respect of investments, job opportunities offered as well as research. Are they, after operating, fulfilling these criteria?.
“With this change, our economy will expand well throughout the year. It is hoped that 2017 will be good for the economy. The first two quarters of the year recorded growth of 5.6% and 5% respectively and it is hoped, government revenue will improve for us to implement planned programmes,’ he added.
To another question, Mohd Irwan described how Malaysia’s Mass Rapid Transit (MRT) project had helped Malaysia retain its A- credit rating with Fitch Ratings.
“When Fitch Ratings came, I took them to the Tun Razak Exchange (TRX) city. I went 40 feet underground to show them the MRT station, and highlight that we are equivalent to the developed nations. They were very impressed and immediately said (to me), that we would maintain our A-rating,” he said.
On borrowings, Mohd Irwan said the Government’s growing guaranteed debt to pay for development, would bring economic prosperity for the country in the long run.
“We have a self-imposed limitation, and have kept to that. We do not borrow more than 55% of the gross domestic product,” he added. - Bernama
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