Guan Eng: Public-private partnership to continue, through open tender from now

Lim gives a speech at the Securities Commission Malaysia headquarters in Kuala Lumpur October 1, 2018. — Picture by Hari Anggara
Lim gives a speech at the Securities Commission Malaysia headquarters in Kuala Lumpur October 1, 2018. — Picture by Hari Anggara

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KUALA LUMPUR, Oct 1 — The Pakatan Harapan (PH) government will not cancel all directly negotiated public-private partnership (PPP) projects undertaken by the previous Barisan Nasional (BN) administration, Finance Minister Lim Guan Eng said today.

However, he said future PPP projects will be undertaken on a “new and clean model” of open tenders, in line with PH’s policy for transparency, accountability and to get the most value for public money.

“The Government recognises the benefits of PPP projects for the Malaysian public and will not take the extreme measure of cancelling all such projects carried out by direct negotiation of the previous administration,” he said in his speech while officiating the Institute of Corporate Directors Malaysia at the Securities Commission here.

Malay Mail received a copy of his speech.

Lim said that in a recent review, his ministry found 14 out of 17 PPP projects, most of which concerned land swap deals for the building of public facilities like housing, schools and fire stations, had not undergone an open tender but were agreed to based on direct negotiation by the past administration.

“Such a direct negotiated process not only perverts the model of PPP into a piratisation exercise or crony capitalism, it also puts the Federal government into deep debts,” he said.

This is because the actual value of government land is underpriced while the building cost is overpriced, he explained.

“This is evidenced by the newly discovered additional RM201 billion debt that has to be borne by the Federal Government as a result of this perversion of the PPP model,” he added.

He then said that his ministry is willing to proceed with the 17 projects and other PPP projects in future, but only on condition that they are conducted through an open tender.

“This is one of the alternatives adopted by the Ministry to ensure that the projects will be carried out instead of taking the extreme approach of cancelling them altogether,” he said.

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