Mindef to take action against company for delay in delivering six littoral combat ships, says minister

Defence Minister Datuk Seri Ismail Sabri Yaakob said his ministry was conducting an investigation into the matter as the company had failed to complete the project within the allotted time. — Picture by Yusof Mat Isa
Defence Minister Datuk Seri Ismail Sabri Yaakob said his ministry was conducting an investigation into the matter as the company had failed to complete the project within the allotted time. — Picture by Yusof Mat Isa

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KUALA LUMPUR, Aug 26 — The Defence Ministry (Mindef) will take appropriate action against the company responsible for the delay in delivering six littoral combat ships (LCS), which were supposed to be delivered in 2019.

Defence Minister Datuk Seri Ismail Sabri Yaakob said at the moment, they were waiting for feedback from the company.

He said his ministry was conducting an investigation into the matter as the company had failed to complete the project within the allotted time.

“Mindef can send a claim for late bill but that will not solve the problem. Therefore, this matter will be tabled in the Cabinet with the three proposals I mentioned in Parliament, earlier,” he told a press conference after a working visit to the Armed Forces Family Housing (RKAT), at Batu Cantonment Camp here, today.

Ismail Sabri said this when asked to comment on the 2019 Auditor-General's Report (LKAN) on the issue.

Earlier, the media had reported that Mindef was considering terminating the contract of a company supposed to supply six Royal Malaysian Navy (RMN) LCS assets.

Following that, Ismail Sabri gave three options in relation to the direction of the LCS project, that will be presented to the Cabinet as a measure to save the contract.

The three options are for the project to be continued by appointing Naval Group France as a rescue contractor through a Deed of Assignment with Boustead Naval Shipyard Sdn Bhd (BNSSB) using the remaining contract ceiling to complete at least two LCS units.

As for the second option, the project is continued by BNSSB with the remaining contract ceiling to complete at least two LCS units while the third option is the termination of the contract with BNSSB and the ministry starting efforts to save the project.

On Monday, according to the LKAN, it was found that Mindef had failed to impose a late fine of RM116.54 million on the company following the delay in the delivery of the six LCS.

LKAN found that the amount was for a delay of 245 days from the date it should have been delivered, which was April 2019 until the audit was conducted. — Bernama

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