The Malaysian Insight

GREATER transparency is the reason Putrajaya ditched the project delivery partner for a turnkey model to complete the RM29 billion Pan Borneo Highway project.

Sabah Chief Minister Mohd Shafie Apdal today confirmed Putrajaya assented to the new model, which places the Works Ministry in charge of the project and the hiring of turnkey contractors to complete constructing the remaining 2,324km of highway.

“We have discussed at length with our colleagues in Putrajaya, including Finance Minister Lim Guan Eng and Works Minister Baru Bian and reached an agreement to cut short management of the project, and without the involvement of the private sector via PDP.

“How can we allow a private entity to manage billions of ringgit? We must be accountable. We must let the government, the Public Works Department, the Finance Ministry, the federal and state governments be involved to ensure the project becomes more transparent.

“The government has more or less agreed to the new approach,” he said, after launching the Heart of Borneo conference in Kota Kinabalu, today.

The Edge today reported that Putrajaya was switching from the PDP to the turnkey model for the project due to cost overruns.

PDP contractors are usually paid a certain percentage of the project cost and and are impervious to the effects of cost overruns and delays. This compares to the turnkey model, in which the project cost is fixed from the get-go. – March 21, 2019.