Defending KLIA2 cost increase, minister says onus on MAHB to resolve problem

The construction of KLIA2 had come under intense scrutiny from opposition MPs over its RM4 billion price tag, which was three times its original cost estimate. — Picture by Saw Siow Feng
The construction of KLIA2 had come under intense scrutiny from opposition MPs over its RM4 billion price tag, which was three times its original cost estimate. — Picture by Saw Siow Feng

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KUALA LUMPUR, May 22 — Putrajaya defended today the increase in the construction cost of Kuala Lumpur International Airport 2 (KLIA2), saying the onus was now on Malaysia Airports Holdings Berhad (MAHB) to resolve the matter.

This followed findings by the Public Accounts Committee (PAC) confirming questionable decisions made by MAHB that led to the cost of the budget terminal ballooning to RM4 billion from its initial budget of RM1.7 billion when it was first announced in July 2007.

In a press conference two days ago, PAC member Tony Pua said that Transport Minister Datuk Seri Liow Tiong Lai should be “held in contempt” of the PAC’S findings on KLIA2, accusing Liow of protecting the culprits behind the project’s RM4 billion price tag.

In a statement today, however, Liow said that he had always backed PAC’s call for an audit of the airport, adding that he is therefore shocked by Pua’s allegations.

“The Ministry of Transport fully supported the move to audit KLIA2 in Cabinet, which has granted approval. The AG (Auditor General) will be requested to undertake the task.

“Hence, I am baffled by the malicious and twisted comments from YB Tony Pua pertaining to KLIA2,” the federal minister said.

“I also do not dispute that additional costs were incurred. But these costs were the result of the scope and requirements in facilities and size which were reviewed and extended, given additional needs of key stakeholders,” Liow added, claiming it has “always been the responsibility of MAHB” as the owner and manager of the airport in question to engage with the PAC and respond in a transparent manner.

“MAHB must take the necessary action to shed light on the findings of the PAC and I expect them to resolve this as quickly as possible,” Liow said.

In a written reply to Raub MP Datuk Mohd Ariff Sabri Abdul Aziz on May 19, Liow said the increase in costs was due to a new design concept for the airport.

“Actually, the KLIA2 project never had cost overruns — the cost of KLIA2 increased because of an increase in scope due to a new design concept of KLIA2,” Liow said.

He added that stakeholders like aviation companies and the government had “detailed needs”, which could have also contributed to the increase in cost.

KLIA2 opened on May 2 last year.

The construction of the airport for budget carriers had come under intense scrutiny from opposition MPs over its RM4 billion price tag, which was three times its original cost estimate.

Liow also said that MAHB was in negotiations with KLIA2 contractor JV UEM-Binapuri to discuss liquidated ascertained damages for the delays in completing the project.

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