Petaling Jaya Utara Member of Parliament Tony Pua has slammed the Najib-run government for practicing “kangkung” economics by awarding lucrative contracts to parties who are not the lowest bidders.
“The Energy Commission (EC) confirmed weeks of alleged “baseless speculation” that 1MDB will be awarded the new Independent Power Producer (IPP) 2,000MW coal-fired power plant concession,” he said, adding also that the project is said to be worth RM 11 billion.
1Malaysia Development Bhd – Mitsui Co. Ltd (1MDB-Mitsui) , were selected by the Energy Commission (EC) on 28 February despite having a a higher levelised tariff of 25.33 sen/kWh compared to YTL Power International Bhd’s 25.23 sen bid. This is not in accordance to the selection criterion that favours the lowest levelised tariff offered by a request for proposal (RFP) compliant bidder.
“When we demanded for transparency and explanation over the evaluation, calculation and selection criteria by the EC and the Ministry of Energy, Green Technology and Water, all we received was stone-walled silence. The Government hence cannot blame the rakyat for thinking that this is a clear-cut desperate attempt to prop up 1MDB, which is labouring under a mountain of debt estimated in excess of RM30 billion,” Tony said.
He also highlighted other high profile multi billion ringgit projects which weren’t awarded to the qualified bidder with the lowest price.
In August 2012, the RM1.18 billion Ampang LRT Extension Project was granted to George Kent Bhd that was priced RM 167 million higher than the originally recommended bid by project owner Syarikat Prasarana Negara. Pua added that, although failing the technical criteria and rejected by the professional evaluation consultants, George Kent was subsequently awarded with the contract.
“What gave away the manipulation at the highest level was the fact that George Kent won the bid over other establish rail players such as Siemens, Balfour Beatty, Bombardier, Posco and Colas despite having zero experience in rail projects. Today, the LRT project is delayed by at least 12 months and it is likely to result in additional costs for Syarikat Prasarana Negara,” he said.
Pua, who is also DAP National Publicity Secretary, pointed out that Najib’s actions contradict his own “New Economic Model”. Najib had previously proclaimed that “we can no longer tolerate practices that support the behavior of rent-seeking and patronage…” when he launched his landmark New Economic Model (NEM) to replace the New Economic Policy (NEP) on 30 March 2010.
“It has become clear that Dato’ Seri Najib Razak has abandoned the “New Economic Model”. Instead what we are witnessing a “transformation” into his “Kangkung” Economic Model, leading to vicious cycle of price hikes and higher costs of living for Malaysians,” concluded Tony. -The Rocket
