LCS project continues to be plagued by delays, says PAC chairman

KUALA LUMPUR: The controversial littoral combat ship (LCS) project continues to be plagued by delays, says Datuk Mas Ermieyati Samsudin.

"The Public Accounts Committee (PAC) 's main worry is that the LCS's construction continues to be delayed.

"The Defence Ministry has informed that the project is delayed by 86 days and achieved 67.28% compared to the 68.77% under the ministry's new timetable schedule," the PAC chairman told reporters at a press conference in Parliament on Thursday (Feb 29).

She added that the detailed design for the LCS has yet to be finalised between the ministry and the Naval Group in France.

She also said that the contractors of the LCS, Boustead Naval Shipyard (BNS), are now known as Lumut Naval Shipyard or Lunas.

The name change, she said, came after the Minister of Finance (Incorporated), through its subsidiary Ocean Sunshine Bhd, took over BNS on August 18 last year.

The PAC tabled its report on the follow-up action by the ministry on the recommendations by the PAC for the period between October and May 2023 and from June to September last year.

Last month, Mas Ermieyati said that the LSC 1 (KD Maharajalela) will be handed over to the Royal Malaysian Navy (TLDM) in October 2026.

The controversial LCS project was highlighted in the Auditor-General's Report 2019, with the PAC initiating an investigation in 2022 and making several recommendations that have since been implemented.

Under the multi-billion project signed in 2014, six LCS ships were supposed to be delivered in stages beginning in 2019, but none were completed as scheduled.

The LCS project came under scrutiny after the PAC revealed that the government had already paid out RM6.08bil.

During its probe, the PAC said that some RM1.4bil in government allocations for the project had been diverted for other purposes.

The PAC had said that the Navy should receive five of the ships in August 2022.

Former Navy chief Tan Sri Ahmad Ramli Mohd Nor, 78, was charged with three counts of criminal breach of trust involving RM21.08mil at the Sessions Court.

On Jan 30 last year, the government reduced the LCS ships to five units from the initially agreed six.

Owing to delays, the PAC, in its previous report, stated that the last of the five ships would only be ready by the year 2029.

The delays resulted in the cost of LCS construction increasing from RM9.128bil to RM11.22bil with an increase of RM2.098bil.

Meanwhile, Mas Ermieyati said the PAC will also begin its probe into the proposed Multi-Lane Free Flow (MLFF) project.

Although the issue was not raised in the Auditor-General's Report, she said the PAC is empowered to initiate investigation into matters involving public funds.

She said that the Works Ministry's deputy secretary-general (Policy and Development), Datuk Zahrul Hakim Abdullah; Malaysia Highway Authority's (LLM) director-general Datuk Sazali Harun; and MLFF head of special functions team, Khairulanuar Muhari, were called to appear before the PAC on Feb 26.