KUALA LUMPUR – Following the announcement by the Public Accounts Committee (PAC), former defence minister Datuk Seri Ahmad Zahid Hamidi said he has no knowledge of payment issues concerning the non-delivery of six littoral combat ships (LCS).
In a statement today, he said the contract awarded on April 17, 2002, to Boustead Naval Shipyard Sdn Bhd (BNS) adhered to the guidelines on direct negotiation procurement, whereby it could only be approved by the Finance Ministry, not Defence.
“On the issue of late penalty, the Defence Ministry had provided further explanation. The ministry also stated that a letter of demand was sent to the ‘pegawai pengawal’ for approval.
“The issue surfaced in 2019 and I was defence minister from April 2009 to May 2013.”
He said issues concerning the non-delivery of the six LCS surfaced last year when he was no longer defence minister and that the matter is beyond his knowledge.
“I would like to stress that Boustead Naval Shipyard is owned by Boustead Holdings Bhd, of which the Armed Forces Fund Board (LTAT) is the biggest shareholder, and the second biggest shareholder is Retirement Fund Inc (KWAP). Both these entities belong to the government.
“On the scheduled payments to Boustead, they were done in 2019 when I was no longer minister. That is why I have no knowledge or control over decisions made by the ministry on the matter.”
He said while he respects the PAC’s jurisdiction and role, it should be more sensitive in handling the investigation process, especially matters of national security.
He added that his statement does not change his intention to continue cooperating and assisting the PAC in completing its investigation.
Yesterday, the PAC had said it will call Zahid early next month to complete proceedings regarding the defence matter.
PAC chairman Wong Kah Woh had said it would also call former Royal Malaysian Navy chief Tan Sri Abdul Aziz Jaafar and BNS, the main contractor of the warship project.
“The appointment of BNS Sdn Bhd was made through direct negotiation and, as of October this year, RM6.083 billion has been paid, but none of the ships have been built. According to the schedule, two LCS should have been built by now,” he told a press conference at the Parliament building yesterday.
He said the PAC will also visit the LCS shipyard in Lumut, Perak, next month.
“The PAC views seriously the issue of the non-delivery of the six LCS involving the Defence Ministry and a procurement value of RM9 billion... as it reflects weaknesses in terms of governance, procurement and finance, which will have a negative impact on national security and defence,” he said.
He said several witnesses had been called for the four meetings and proceedings conducted so far, including Auditor-General Datuk Nik Azman Nik Abdul Majid, Defence Ministry Secretary-General Datuk Seri Muez Abdul Aziz, and Governance, Procurement and Finance Investigation Committee chairman Tan Sri Ambrin Buang.
“The PAC plans to complete and table its report on this issue at the Dewan Rakyat by March 2021.” – The Vibes, December 18, 2020
