KUALA LUMPUR, Aug 8 — Transparency International Malaysia (TI-M) today criticised the Littoral Combat Ship (LCS) scandal, comparing it to the 1Malaysia Development Berhad (1MDB) scandal and saying that Malaysia is increasingly becoming known for its bad governance practices resulting in the loss of billions of ringgit of public funds.
In a statement this morning, TI-M asked several questions pertaining to the background of the LCS controversy including on what basis Boustead Naval Shipyard Sdn Bhd was awarded the contract.
It also made several recommendations such as not making further payments until the delivery of the ships, investigating all levels of contractors and subcontractors, and a mandate on all high value and high impact projects to be reviewed by parliament before approval.
“With numerous governance and audit structures within the public sector which are responsible to prevent corruption and improve good governance practices in place, how could the LCS project which started in 2013 be allowed to become a colossal procurement and governance failure for so long? “How could they collectively have missed all the red flags?
“Where is the oversight, governance and accountability? Or has it become conveniently invisible, just like the ships that were supposed to be delivered? Is it any wonder that Malaysia’s Corruption Perception Index (CPI) score has been on a downward trend the past two years since a high in 2019?” it said.
TI-M president Muhammad Mohan called the debacle “a major question mark as to the integrity, transparency and good governance of this project”.
Former deputy defence minister Liew Chin Tong yesterday alleged that Datuk Seri Ahmad Zahid Hamidi had approved the project when he was the defence minister in 2011.
Ahmad Zahid had previously told Umno Online that he was not the defence minister at the time the project was awarded.
Last week, Senior Minister of Defence Datuk Seri Hishammuddin Hussein said that the Public Accounts Committee’s (PAC) report and recommendations about the littoral combat ships (LCS) scandal will be scrutinised by the Ministry of Defence (Mindef).
PAC chairman Wong Kah Woh revealed that cost overruns for the Littoral Combat Ship (LCS) project totalled RM1.4 billion, with RM400 million used to pay old debts from an old patrol vessel project.
The LCS project is the largest procurement in the history of Mindef with a total cost of RM9 billion.
The said contract began in 2013 with a ten-year time frame and six LCS ships were expected to be built and delivered to the country by the end of 2023.