No approval for BPA project

Report: No tender or contract clauses but billions okayed

KUALA LUMPUR: The National Audit Department has discovered several weaknesses in procurement management by Bintulu Port Authority (BPA), including the approval of a RM1.247bil project without a comprehensive study.

Also detected in the Auditor-General’s Report 2016 Series 2, which was tabled at the Dewan Rakyat yesterday, were the approval of three procurements for jobs worth RM1.452bil without prior financial allocations, four procurements valued at RM1.467bil without open tender, and conducting direct negotiations without the consent of the Finance Ministry.

“The department found several weaknesses in the direct negotiation process, tender process, consultant and contractor appointment and contract clauses.

“Consultancy fees were also not supported by complete documents and the board of directors’ instructions to postpone the supply base project were not complied with,” said the report.

The report said there were also elements of fraud in the preparation of the minutes of a meeting for a tender, and resolutions in a letter relating to it had influenced the Transport Minister to approve the appointment of Muhibbah Viccana Joint Venture (MVJV), a joint venture company between Muhibbah Engineering (M) Bhd and Viccana Sdn Bhd, as contractor.

An audit by the department on procurement for construction of a wharf at the supply base project in the Second Basin of Bintulu Port, worth RM1.247bil, found that there were two sets of minutes of separate meetings provided by the BPA general manager and the meeting’s secretariat for the January 2016 board of directors meeting.

“During the No.1/2016 board of directors meeting on March 29, the board of directors agreed that the minutes provided by the secretariat are more accurate and the meeting agreed to approve the minutes.

“The audit on the minutes of the meeting provided by the general manager found the meeting’s decision on the MVJV appointment was contrary to the decision recorded by the meeting’s secretariat, namely by the planning and commercial manager,” said the report.

It said MVJV’s appointment letter, sent to the minister, was only signed by three directors – the board’s chairman, deputy chairman and general manager – while eight board members were present at board meeting No.7/2016.

To overcome the weaknesses, the report suggested that the Transport Ministry instruct the BPA board to conduct a detailed investigation and report to enforcement agencies if criminal elements were found.

The ministry should also order BPA to review the compliance and monitoring mechanism to avoid any misconduct in its internal procurement management, it added. — Bernama