Construction of technical service centre unsatisfactory

THE construction of a technical service centre for the maintenance of Sukhoi SU-30MKM fighter aircraft at the RMAF airbase in Gong Kedak, Terengganu, worth RM73mil, was less than satisfactory, according to the 2015 Auditor-General’s Report (Series 2).

It said progress for the first 10 months of its construction was slow, and resulted in the project being taken over by a sub-contractor on Jan 15 last year.

“The progress of the project within the first 10 months between March and December 2014 was unsatisfactory as only 3.3% progress was achieved compared to its target achievement of 39.1% based on the actual working schedule,” said the report.

The Finance Ministry had appointed Syarikat Pembenaan Setia Jaya Sdn Bhd (SPSJ) as the main contractor, with a contract value of RM71.49mil through a “design and build” approach, said the A-G report.

SPSJ was selected via a restricted tender process and a Letter of Award was granted on March 10, 2014 followed by a formal contract which was signed on July 7, 2014 with a completion period of 78 weeks.

The report noted that the appointment of “unqualified and financially unsound” contractor had affected the project’s implementation and progress.

The second Extension of Time (EOT 2) was approved although a Certificate of Non-Completion (CNC) had been issued. Construction work was satisfactory except for a few non-compliance issues, inadequacies, and defects which required appropriate measures to be taken.

The report recommended the Defence Ministry to ensure such appointment of contractors be based on experience, qualification and capabilities to execute the project.

In reply to the Treasury, the Public Works Department had issued repeated warnings to the contractors during site visits, monitoring coordination and technical meetings,

“The project progress improved after it was taken over by Solar Alert Sdn Bhd on Jan 15 last year, which is a sub-contractor appointed by SPSJ,” said the Ministry of Defence.

The construction of the centre was part of the Government’s countervailing programme for the acquisition of the Sukhoi fighter aircraft, which included the delivery of aircraft components from Federal State Unitary Enterprise (Rosoboronexport) of Russia.

The project comprised a hangar building, ADZ bay, POL store, AGSV/E garage, shelter, ramp service, apron area and a special equipment procurement.