News & Articles Contractor’s financial woes delay project
Contractor’s financial woes delay project
22 Nov 2016
The construction project for a multi-storey carpark at the Hospital Canselor Tuanku Mukhriz (HCTM) worth RM28.6mil was not completed on time due to the financial constraints of its contractor, said the 2015 Auditor-General’s Report (Series 2).
The report noted that the progress of the carpark project at HCTM, which was formerly known as Hospital Universiti Kebangsaan Malaysia (HUKM), stood at 22.3% as of Aug 18 last year.
“The late progress was due to the contractor’s financial constraints and the inability to continue the construction work.
“The contract was terminated on Oct 15, 2015 and a penalty of RM314,031 was imposed for the delay,” said the report.
The report said the Public Works Department (JKR) had appointed a new contractor for the project.
UKM received RM10mil under the 10th Malaysian Plan for the project, which would be implemented by JKR.
The report said that Universiti Kebangsaan Malaysia and HCTM spent RM1.83bil from 2013 to 2015 on procurement through direct purchases, quotations, tenders and direct negotiations.
The report found 512 local orders or invoices amounting to RM1.17mil were split into smaller amounts in order to avoid red tape on price quotation procedures.
“The approval for 10 work procurement through direct purchases worth RM92,845 in two residential colleges had exceeded the authorised limit.
“Six of the procurements, which were supposed to be carried out through quotations, were worth more than RM20,000 each,” it said.
The report revealed that a total of 186 local orders amounting to RM268,892 between 2013 to 2015 were prepared, verified and approved by the same officer.
“A total of RM19,684 was paid to the supplier for eight loud speaker equipment for the Langkawi Research Centre, but was never delivered,” it said..
The research centre, established in 2002, focused on developing natural resources and research for tourism in Langkawi under UKM.
The report recommended HUKM manage its procurements in accordance with the rules and good governance practices to avoid procurement for the same type of items being split into smaller amounts.
In reply to the Treasury, HUKM said any procurement worth between RM20,000 to RM50,000 must obtain an approval from UKM’s special quotation committee, while procurements worth between RM50,000 to RM500,000 must be brought to the procurement committee for consent.
The report noted that the progress of the carpark project at HCTM, which was formerly known as Hospital Universiti Kebangsaan Malaysia (HUKM), stood at 22.3% as of Aug 18 last year.
“The late progress was due to the contractor’s financial constraints and the inability to continue the construction work.
“The contract was terminated on Oct 15, 2015 and a penalty of RM314,031 was imposed for the delay,” said the report.
The report said the Public Works Department (JKR) had appointed a new contractor for the project.
UKM received RM10mil under the 10th Malaysian Plan for the project, which would be implemented by JKR.
The report said that Universiti Kebangsaan Malaysia and HCTM spent RM1.83bil from 2013 to 2015 on procurement through direct purchases, quotations, tenders and direct negotiations.
The report found 512 local orders or invoices amounting to RM1.17mil were split into smaller amounts in order to avoid red tape on price quotation procedures.
“The approval for 10 work procurement through direct purchases worth RM92,845 in two residential colleges had exceeded the authorised limit.
“Six of the procurements, which were supposed to be carried out through quotations, were worth more than RM20,000 each,” it said.
The report revealed that a total of 186 local orders amounting to RM268,892 between 2013 to 2015 were prepared, verified and approved by the same officer.
“A total of RM19,684 was paid to the supplier for eight loud speaker equipment for the Langkawi Research Centre, but was never delivered,” it said..
The research centre, established in 2002, focused on developing natural resources and research for tourism in Langkawi under UKM.
The report recommended HUKM manage its procurements in accordance with the rules and good governance practices to avoid procurement for the same type of items being split into smaller amounts.
In reply to the Treasury, HUKM said any procurement worth between RM20,000 to RM50,000 must obtain an approval from UKM’s special quotation committee, while procurements worth between RM50,000 to RM500,000 must be brought to the procurement committee for consent.
Source: Thestar.com.my