Open tenders a must for mega projects
FocusM team | 01 Jun 2018 00:30
Now that the country’s national debt has exceeded the RM1 tril level, it’s no surprise that the new government has cancelled at least two big-ticket infrastructure projects.
The High Speed Rail (HSR) project is estimated at a massive RM110 bil and the MRT3 project at between RM35 bil and RM40 bil. The immense cost of these mega projects makes you wonder how the estimations were made in the first place.
The HSR project might have been more viable if the cost was at a fraction of the RM110 bil price tag. The price works out to some RM314.3 mil per kilometre (km), making it one of the most expensive rail projects per km in the world.
To be sure, there was an open tender to appoint the project delivery partner (PDP) for the HSR project. It was called on Nov 22, 2017 and was conducted by MyHSR Corp. But who else bid for the project? And was the winner the most competitive?
It is thus important that such mega contracts are awarded on an open tender basis and not through direct negotiation to ensure they are carried out by competent contractors with the lowest possible cost.
When the winner is selected, it would be good if the other closest bids are revealed as well. Granted, the lowest bid may not always be accepted due to various factors such as experience and expertise but there must be convincing reasons why this was so.
There were allegations that the East Coast Rail Link (ECRL) was inflated by some RM20 bil when it was signed back in 2016. There were questions on why state-owned China Communications Construc-tion Company was awarded the RM55 bil project via direct negotiation, even if there were “favourable financing terms” factored into the decision.
The RM30 bil Pan Borneo Highway project which stretches 2,325km is also likely to be reviewed. Are the project’s benefits justified at such a high cost?
An open tender which is carried out transparently is a mark of good governance. It is taxpayers who foot the bill for public projects and they would expect to get the best value for money.
Let’s hope the new government lives up to the people’s expectations.
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