PETALING JAYA: The Economic Planning Unit (EPU) was taken to task for disregarding the Defence Ministry's repeated request over the years to terminate the contract of a "slow coach" contractor involved in a proposed construction of the RM256mil Skudai 7 Brigade Complex in Pulai, Johor.
Now, 21 years later, the project on a sprawling 219ha plot was left abandoned, and the army was "squatting" on two plots of exchanged land where the title deeds had already been transferred to the contractor.
These are among the findings submitted by the Governance, Procurement and Investigating Committee (GPIC), headed by former auditor-general Tan Sri Ambrin Buang over the controversial land swap deals.
The committee noted that the authorities had four years ago hauled the contractor to court for failing to deliver the project, despite having the deadline extended several times upon appeal.
The Defence Ministry was advised to put a caveat on the lots housing Kem Tebrau (124ha) and Kem Penggawa Timur Plentong (28ha), pending court ruling.
The contractor had failed to deliver the complex after inking an agreement with the relevant authorities in 1997.
The army camps would have been relocated to the new site in Skudai 17 years ago, if the project was completed according to deadline.
"It was unfortunate that the Land Bond and the Performance Bond were not extended to secure and protect government interest," the committee noted.
According to the agreement, the Final Drawing and Final Costing of the project should be finalised within three months after inking the agreement on July 10, 1997, but it was not finalised even after two years.
The contractor had in 1999 informed the EPU that the Ministry had pushed for amendments to the design several times, thus causing the initial delay.
Noting that the project was only 18.72% completed in 2004, the committee said the contractor was also slow in delivering other projects.
"The same contractor was awarded another contract to build an army camp costing RM66mil in 1997. The project should have been completed within 36 months.
But it was only completed 11 years and 10 months later in September 2008.
"Its subsidiary was awarded another construction project costing RM291mil. The project should have been completed within one year. But it took five years and eight months," it said.
Noting the poor track record, the investigating committee said the contractor was awarded several government projects despite late delivery and failure to deliver.
"The company did not have the financial capability and experience to carry out large scale projects," the committee noted.
It called on the authorities to blacklist the errant contractor.
In another report released on Thursday (May 16), the committee noted that it was not necessary to swap land in return to build 60 units of army housing project worth RM10.99mil in Cameron
Highlands.
They said the units could be built using government allocations, without having to let go of army land that could be used for other projects in the future.
They were referring to the army houses built at Kem Slim in Tanah Rata, Cameron Highland, swapping two plots of military land in Brinchang.
Initially, in 1995 the Defence Ministry had proposed to build a high altitude training centre on a 35ha plot in Kem Berinchang, but the project was taken off the list in 2001.
In 2009, a company wrote to then prime minister and finance minister Datuk Seri Najib Razak proposing to buy two plots of military land in Brinchang at RM45.2mil and in return, it would build housing units for the army.
In 2015, the Public-Private Committee (JKAS) proposed to the Cabinet to increase the value of land by 30% to RM136.2mil because the land size was increased from 34ha to 39ha, and the leasehold period was reduced from 988 years to 99 years.
"Of the RM136.2mil sales of land, RM10.99mil would be used to finance the army housing project, and the remaining amount transferred to Kumpulan Wang Disatukan (KWD)," it said.
It noted that the project was completed in 2017 after a delay of 225 days.
However, the contractor was not at fault as the delay was caused by technical issues.
The army housing scheme, comprising an apartment block and a two-storey bungalow, was completed in September 2017 and occupied in January last year.
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