KUALA LUMPUR, Oct 27 — The Public Accounts Committee (PAC) has asked the Malaysian Anti-Corruption Commission (MACC) to investigate Universiti Malaysia Terengganu’s (UMT) procurement of a project to construct a research vessel, after discovering that financial procedures and technical specifications were flouted.

The Parliament's committee said that the RM14.39 million RV Discovery — which was funded by Prime Minister's Department's Economic Planning Unit (EPU) — is an "ailing project" as it was downgraded to a mere cargo ship, after failing to fulfil specifications required for a "special purpose ship".

The PAC, in its report tabled in the Dewan Rakyat today, said the university did not engage a naval architect and was entirely dependent on contractor, Kay Marine Sdn Bhd to construct the ship — which was highlighted in the third series of the 2012 Auditor-General's Report for disregarding the Finance Ministry's financial procedures.

"The PAC finds that UMT's officials involved were reckless and inefficient... many of the decisions made during the course of construction appear to favour the contractor," said the report.

In its summary, the PAC recommended action to be taken against the university's former vice-chancellor Professor Dr Datuk Abd Aziz Deraman as well as Professor Datuk Dr Sulaiman Md Yassin and Mohd Zaideen Yusoff, who were in charge of the project.

The committee said UMT did not undertake the necessary due diligence, including a background check on the contractor, the company's past performances, its shareholders conflict of interest and the company's financial status — which had led to wastages, added PAC.

Among others, the report made note of a "serious element of conflict of interest" in the change of RV Discovery’s initial classification under internationally renowned classification societies - Lloyd's Register Group, Det Norske Veritas and American Bureau of Shipping - to the local Ships Classification Malaysia (SCM).

"There is a conflict of interest because Kay Marine's director is the second highest shareholder in SCM," stated the report.

"The PAC is extremely dissatisfied with the procurement of the project, which did not meet targeted objectives," said the committee.

The project to build the RV Discovery was funded by Prime Minister's Department's Economic Planning Unit (EPU) and given a ceiling of RM12.5 million under the Ninth Malaysia Plan.

It was scheduled to be constructed between 2008 and 2010 for RM11.99 million but was delayed for two years and incurred an additional cost of RM2.4 million, following two work adjustments.

According to checks by the National Audit Department in January last year, the vessel was not authorised to carry passengers.

Ten months later in October, the RV Discovery was classified as a cargo ship by the Marine Department and only allowed to ferry 12 passengers at a time.