Ministry firm on fee stance

Review shows Penang govt overpaid for road designs, says Fadillah

The Works Ministry and the Board of Engineers Malaysia (BEM) are standing by their earlier statement that Penang significantly overpaid design fees for three roads.

In a statement yesterday, minister Datuk Seri Fadillah Yusof said Penang’s earlier denial of overpayment could not stand when all the components were scrutinised in accordance with BEM’s scale of fees.

He was responding to Penang Local Government Committee chairman Chow Kon Yeow’s claims just before Hari Raya, where the latter argued that the RM177.5mil in fees was not excessive as it included 10 additional components.

On June 24, Chow said that besides consultation fees, the RM177.5mil was used for additional components such as land survey, detailed environmental impact assessment (DEIA), land tunnel design, architectural design, mechanical and electrical design, project management, social impact study, traffic impact study, financial feasibility and funding management.

Fadillah pointed out that three of the 10 components fell under the purview of BEM, other than the civil and structural works, with payment for items such as the Land Tunnel Design and Mechanical and Electrical Design also falling under BEM’s scale of fees.

Fadillah said four other components – DEIA, social impact study, traffic impact study, financial feasibility and funding management – were components of the feasibility studies, for which an additional RM31.2mil fee, on top of the RM177.5mil fees, was also paid by the Penang government.

Fadillah said Chow’s earlier comment was untrue as there was “double counting”.

“Based on the information given, we note that the total pre-construction consultancy fees for the 20km of roads is RM208.7mil – comprising RM31.2mil for feasibility studies and RM177.5mil for detailed design,” he said.

Given this, Fadillah said his ministry and BEM concluded that the total fees paid were “significantly above our guidelines and excessive”.

He also urged Chow to be careful when talking about the fees so as not to confuse the public, given that the road construction industry here was “well regulated and established”.