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View Full Version : Who will be held responsible for the Matrade building debacle?



sirgalahad2010
24-05-2006, 05:21 PM
Let's see now - a building that is 9 years late and more than RM100 million over budget.

Ultimately, it looks as though the Selangor state govt will have to shoulder the blame as the now-defunct Perangsang International, the project developer, was a subsidiary of the investment arm of the state govt.

Further, Perangsang International was awarded the project in 1994. As far as I know, the project was not put out for competitive tender.

And let's not forget that this happened on Samy Vellu's watch as Works Minister.

Also the spectacle of Rafidah criticising the delay and the cost overrun.

Will people be held to account? Or will the federal govt excuse this away as part of the necessary "learning curve" for home-grown companies who aspire to bigger things?

I can't help thinking that a company like IJM or YTL would have completed the project on time and within budget. But that's heresy, right?

isarahim
25-05-2006, 07:30 AM
In addition we can ask the basic question why Matrade needs a building which is about 3-5 times as large as the office space taken up by the corresponding organisations in UK, Germany etc?

Why is it that almost every Malaysian government organisation needs its own building when corresponding organisations in other, much larger, countries can fit in one or a few floors?

isarahim
25-05-2006, 08:20 AM
And finally, we can ask the question: Do we need Matrade at all?

What do they contribute?

Do they have any positive impact on Malaysian exports at all? If so, is it enough to justify these massive costs?

Aren't the various CoC's and other associations plus our network of embassies and high commissioners enough?

Can't we just scrap Matrade altogether? Isn't this one of those many organisations whose raison d'etre is their own existence, i.e. they are generating work for themselves?

sirgalahad2010
25-05-2006, 09:13 AM
Pak Isa

Excellent points!

All part of the "learning curve" for u-know-who? Or, as the British say, "jobs for the boys"?

Pt of clarification: is Kak Rafidah's office in Putrajaya or in KL?

Joe Gomez
25-05-2006, 10:32 AM
There is a general reticence in this country to comment about errors ..... indeed boo boos ........... committed in the name of bumiputra progress. It was okay ( less unplatable, I mean ) around 10 years ago when the learning curve was steep and climbing it was a veritable challenge AND more so because Malays were painted by the gormen as people who needed time to learn ............... TRUE or NOT is not my point ...............
HOW LONG MY DEAR BUMIPUTRA BROTHERS AND SISTERS WILL YOU TOLERATE THE TOTAL CRAP BEING DISHED OUT BY BARISAN IN THE NAME OF BUMIPUTRA BROTHERHOOD ???
HOW MUCH FACE ARE YOU WILLING TO GIVE ............ NOT FOR YOURSELVES .......... BUT BARISAN'S INEPTNESS ???

Chia Hak Soon
25-05-2006, 11:29 AM
Joe Gomes, cool ,brother. I remember you were affected by the not too long ago floods that affected your house. Now Northern Thailand is flooding and we may expect another unexpected pour according to CNN. Please take care ,take an aerial view of your area and you will note that the amount of development near you is poised for more floods to come.

swee_ann_tweety
25-05-2006, 12:25 PM
Let's see now - a building that is 9 years late and more than RM100 million over budget.

Ultimately, it looks as though the Selangor state govt will have to shoulder the blame as the now-defunct Perangsang International, the project developer, was a subsidiary of the investment arm of the state govt.

Further, Perangsang International was awarded the project in 1994. As far as I know, the project was not put out for competitive tender.

And let's not forget that this happened on Samy Vellu's watch as Works Minister.

Also the spectacle of Rafidah criticising the delay and the cost overrun.

Will people be held to account? Or will the federal govt excuse this away as part of the necessary "learning curve" for home-grown companies who aspire to bigger things?

I can't help thinking that a company like IJM or YTL would have completed the project on time and within budget. But that's heresy, right?

You better not say it's "design fault" ! Samy Vellu will warn you just like in the MRR2 case, "Nobody can simply open their mouth and say it's design fault. The consultant reserves the right to sue you"

swee_ann_tweety
25-05-2006, 12:30 PM
Let's see now - a building that is 9 years late and more than RM100 million over budget.

[/B]


Taken from http://www.thestar.com.my/news/story.asp?file=/2006/5/25/focus/14339304&sec=focus

Thursday May 25, 2006


Why no action for nine years?

AS A layman, I find it puzzling how the Government machinery works.

Your front-page report, “Going after directors” (The Star, May 24) said the Works Ministry is now planning to take the directors of Perangsang International Sdn Bhd (the contractor company that failed to complete the Matrade building project after nine years) to court because PISB had apparently gone through some restructuring in 2004 and is no longer in existence.

The simple question here is: This is a major project that involves two ministries (Works and International Trade and Industry) helmed by two of the most senior ministers in the Cabinet and yet no action was taken for nine years?

Trying to seek compensation from the directors now after PISB has folded up is like trying to close the paddock gates after the cows have bolted.

Why was action not taken the moment PISB defaulted or delayed the project years ago? Why are we crying over spilt milk?

One wonders how many other such projects exist in our country. And with the Ninth Malaysia Plan (9MP) just started, what is the Government doing to prevent any recurrence?

We hear of all sorts of monitoring committees but yet we have here two major ministries headed by two senior ministers failing to take timely action.

There is a serious question of credibility here. The Government needs to be very transparent with every major project it is monitoring in the 9MP in order that nothing falls between the cracks.

PUZZLED,
Johor Baru.

swee_ann_tweety
25-05-2006, 12:34 PM
Let's see now - a building that is 9 years late and more than RM100 million over budget.

[/B]

from : http://www.thesundaily.com/article.cfm?id=14209
:D
Matrade building 'monument of shame'
Maria J. Dass

PETALING JAYA: The Malaysian External Trade Development Corporation (Matrade) building should stand as a "monument of shame" and a reminder that more needs to be done to wipe out corruption, Transparency International (TI) Malaysia president Tan Sri Ramon Navaratnam said today (May 24, 2006.

Adding to the pressure to bring the former contractors of the building to book for a nine-year delay in completing the building that has resulted in a 70% increase in cost, he said: "If no action is taken against Perangsang International Sdn Bhd (PISB) for failure to complete the building on time, then the public will be disillusioned with the government's capability to manage our money."

In an interview with theSun, he added: "Why should I pay taxes to the government if I know they are going to misuse it?"

The delay in handing over the building, which was originally scheduled for completion in 1997 saw the construction cost increase from the original RM167 million to RM287.5 million, of which RM64.8 million was spent on repairs.

Matrade which rented premises at Wisma Sime Darby due to the delay also lost RM120 million in opportunity cost from exhibition space rental.

On Tuesday (May 23, 2006), both Works Minister Datuk Seri S. Samy Vellu and International Trade and Industry Minister Datuk Seri Rafidah Aziz said they wanted action taken against PISB's board members and directors.

Navaratnam said: "The officers and contractors who are guilty of mismanaging and abusing public funds should be investigated and charged."

He said the trouble begins with the wrong choice of contractors, adding that the contractor should have been dismissed immediately once there were problems.

"It is okay to hand out contracts to Bumiputra companies, but give it to the best among them, the one that could have done a better job," he said, adding that the government should have an open tender system.

"Ideally there should be joint ventures between Bumiputras and non-Bumiputras so they can learn from each other and at the same time improve work quality and provide adequate checks and balances," he said.

According to the World Bank, between 20% and 30% of development budgets in developing countries are wasted on corruption and other leakages, he added.

"Even if the figure is 10% in Malaysia, this would mean mismanagement and wastage of RM20 billion out of the RM200 billion allocated for the 9th Malaysia Plan," Navaratnam said.

Joe Gomez
25-05-2006, 07:51 PM
Joe Gomes, cool ,brother. I remember you were affected by the not too long ago floods that affected your house. Now Northern Thailand is flooding and we may expect another unexpected pour according to CNN. Please take care ,take an aerial view of your area and you will note that the amount of development near you is poised for more floods to come.A cautionary note to me from anyone is always appreciated ....... seriously. It is not a good idea to get ahead of oneself as Jose told me recently on another thread ......

But, sori, sir, I cant for the world understand where you are coming from Chia Hak Soon. I now your intentions are good . but please clarify .... :o

btw area affected was my brother's ( close enough :p ) but his house not affected ...... he was high and dry .... but marooned in his apartment. His cars however, were totalled by the waters.

cskok8
25-05-2006, 08:56 PM
Now lets see. If PISB were to be forced to pay compensation, the owners (which ultimately was the Selangor State Govt) will have to cough out the money. And if the State Govt does not have enough money; despite being a developed state; it will have to ask for money from the Fed Govt. And where does the fed govt get its money. ME AND YOU :mad: (those of you paying income tax anyway)

Franklon
25-05-2006, 09:35 PM
And finally, we can ask the question: Do we need Matrade at all?

What do they contribute?

Do they have any positive impact on Malaysian exports at all? If so, is it enough to justify these massive costs?

Aren't the various CoC's and other associations plus our network of embassies and high commissioners enough?

Can't we just scrap Matrade altogether? Isn't this one of those many organisations whose raison d'etre is their own existence, i.e. they are generating work for themselves?


1. My guess is Matrade basically functions as a bridge between malaysian manufacturers to meet and sell their goods to foreign peeps. For example, when you have the furniture expo, representatives from foreign countries (germany, italy, australia) will attend such expos and 'order' from the local manufacturers. The 'export' sales generated is even higher than local sales.

2. Like the My-SG bridge? if you're going to build a castle, finish it. Leaving it half way will only be an eyesore and cause ghost to inhabit it :D

jianwei85
25-05-2006, 09:48 PM
1. My guess is Matrade basically functions as a bridge between malaysian manufacturers to meet and sell their goods to foreign peeps. For example, when you have the furniture expo, representatives from foreign countries (germany, italy, australia) will attend such expos and 'order' from the local manufacturers. The 'export' sales generated is even higher than local sales.

2. Like the My-SG bridge? if you're going to build a castle, finish it. Leaving it half way will only be an eyesore and cause ghost to inhabit it :D


LOL. I wouldn't want any ghost in my half-finished properties :)

Teeque
26-05-2006, 03:16 AM
Now lets see. If PISB were to be forced to pay compensation, the owners (which ultimately was the Selangor State Govt) will have to cough out the money. And if the State Govt does not have enough money; despite being a developed state; it will have to ask for money from the Fed Govt. And where does the fed govt get its money. ME AND YOU :mad: (those of you paying income tax anyway)

Well, they need capital to fit out the empty building now and start some activities in it lest the public will complain (again) its a waste of money that the building is left 'unproductive'. Where to get that extra dough? From you and me, of course. Thus, the action to go after the contractors, and eventually getting compensation frm public coffers...

silver_bird
26-05-2006, 09:39 AM
Where is the accountability?
NST - 26 May 2006
LAKSHY, Lahat
--------------------------------------------------------------------------

THE Government keeps spending more and more money on contracts it has awarded. This is proof that there is some weakness in the way government contracts are worded.

When a contract is awarded, there is a schedule for payment. Payments are made as work progresses.

At all stages, progress payments can only be made once supporting documents such as the contractors invoice, certification that work up to that stage is completed, goods received notes duly authorised, etc, have been received.

I am sure Public Woprks department, which employs so many lawyers, would have the experience to draft contracts to protect itself and the Government. Hence it is difficult to understand how PWD can pay for uncompleted buildings!

What happened to the supervision by PWD officials and/or engineers? They have to sign off, before payment can be made to the contractors. Site meetings are supposed to be conducted frequently to discuss the progress of work.

Any variation also requires approval of a site officer representing PWD. Where are the minutes of such site meetings?

Why are PWD engineers and officials not being held responsible for the poor workmanship experienced with these projects?

PWD engineers have been given a duty, and if they fail to do so, they must be made to pay the price. There must be accountability.

For example, for contracts for the supply of chemicals on a monthly basis to PWD, the successful tendering company has to first raise a performance bond in order to be awarded the contract.

If the company fails to deliver the chemicals in a timely manner, the bond can be forfeited by PWD..

In addition, there is a clause in the contract stating that if the company fails to deliver, PWD may then source the chemicals from other suppliers, and the company will have to bear the difference in cost.

Also, since there is a 60-day payment term for the supply of chemicals, PWD can never end up over-paying for the chemicals.

In addition, PWD only pays when the relevant PWD store confirms receipt of these chemicals.

Why are such clauses not enforced for the huge construction contracts when PWD is able to word it for chemical supply contracts? There is also a schedule of payment for construction projects.

Generally, in such payments, you cannot overpay, as the contractor would generally be continuously supplying more stuff and parts to the site, doing variation work, etc.

However, he can only claim payments as permitted in the schedule, and even that, only after they have been approved and certified by the site supervisor.

So, in the event that he abandons the project, the progress of work should be such that getting an alternative contractor to complete the work should not cost much more. It may even cost less.

And remember that the Government has the performance bond of the original contractor that can be claimed against.

In the recent MRR2 project, as well as the Matrade building and the prison construction in Sarawak, it is indeed alarming that PWD has been paying and paying, using the taxpayers money.

First for the project. Then for a consultant and then another consultant or another contractor and the final bill is way over the original estimate.

Why is there no accountability worded into any of these contracts?

Despite the problems occurring from time to time, no concrete measures are taken by PWD or the Works Ministry to improve.

Besides saying that they will take action against the directors of the companies that no longer exist, what steps are being taken to tighten the system within PWD to ensure that projects are not allowed to proceed in the same unproductive manner?

http://www.nst.com.my/Current_News/nst/Friday/Letters/20060526082323/Article/index_html

Chia Hak Soon
26-05-2006, 10:14 AM
Joe Gomes, nothing serious. First I inteprete your comments on Bumipetra duration on the learning curve as frustration. Secondly, I mentioned the flooding to indicate that the present state of control of development by the governing authorities, in this case the Shah Alam. So I advise you to be prepared for more floods during this raining spell. Just as I have mentioned yesterday, ironically there was a heavy downpour yesterday evening.

There is town planning but each time a new MB and new council is appointed, the master plan changes according to their favour, without regards to where the water or traffic flows., thus affecting you and all of us who has invested large sum of monies to buy a house.Today Bukit Gasing is in the midst of being plundered and we may have another Highlands Tower disaster.Sorry to divert from this thread.

jianwei85
26-05-2006, 12:26 PM
Joe Gomes, nothing serious. First I inteprete your comments on Bumipetra duration on the learning curve as frustration. Secondly, I mentioned the flooding to indicate that the present state of control of development by the governing authorities, in this case the Shah Alam. So I advise you to be prepared for more floods during this raining spell. Just as I have mentioned yesterday, ironically there was a heavy downpour yesterday evening.

There is town planning but each time a new MB and new council is appointed, the master plan changes according to their favour, without regards to where the water or traffic flows., thus affecting you and all of us who has invested large sum of monies to buy a house.Today Bukit Gasing is in the midst of being plundered and we may have another Highlands Tower disaster.Sorry to divert from this thread.

According to Chia Hak Soon, his post was supposed to be in Dr. J George -Non Stop Rain And The River Is Swelling! Hehe..Just to inform only lah... :D

Joe Gomez
26-05-2006, 03:33 PM
According to Chia Hak Soon, his post was supposed to be in Dr. J George -Non Stop Rain And The River Is Swelling! Hehe..Just to inform only lah... :DO I C ..... got the wrong JG mah ???? :p

sirgalahad2010
29-05-2006, 01:35 PM
According to Brendan Pereira's column in the New Straits Times today, it was the Finance Ministry which, in 1993, directed that the Matrade building project be awarded to Perangsang International. This overrode a decision by the PWD to award the contract to another construction company.

If I remember right, the Finance Minister in 1993 was Datuk Seri AI. I am not sure who the Works Minister (whose ministry includes the PWD) was then - maybe SV?

So, in attributing blame, can AI tell his side of the story? :confused: