KUALA LUMPUR: The Bintulu Port Authority (BPA) granted a RM1.4bil supply base dock project to a construction company via direct negotiation, according to the Auditor-General's Report 2016 Series 2.
The report added that the granting of the contract was done without obtaining prior approval from the Finance Ministry.
The project did not go through detailed planning before it was awarded to Muhibbah Viccana JV (MVJV) on Dec 16, 2016.
The report said four of the five procurements under the project were done through direct negotiations, when they were supposed to be done through an open tender.
The procurements included the construction of the supply base dock (RM1.24bil), consultation for the project (RM175.3mil), environmental monitoring, compliance reporting and coastal erosion monitoring (RM15.42mil) and consultancy, management and monitoring services (RM29.02mil).
"The Audit did not find any evidence indicating that the BPA had applied for permission from the Finance Ministry to execute procurement through direct negotiation," said the report.
It said that there were also no letters of intent for all four procurements, adding that there were no price negotiations between the two parties.
“BPA’s failure to adhere to these price negotiation procedures expose them to the risks of abuse of power and mismanagement. Without market research and cost estimates, BPA was not able to ensure that this project was best value for money,” it said.
BPA was among the government agencies expected to be summoned by the Public Accounts Committee (PAC) over issues surrounding its expenditures.
