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DAP proposes that Cabinet should cancel award to  MMC-Gamuda  JV and    re-open bidding for the multi-billion  ringgit electrified double-tracking rail project in the interests of fair play,  competitive  pricing,  transparency and integrity – giving Abdullah an opportunity to demonstrate that he is concerned not only about petty corruption but also “Grand corruption”

Media Statement
by Lim Kit Siang

(Penang,  Saturday): DAP proposes that Cabinet should cancel the award to MMC-Gamuda JV and  re-open bidding for the multi-billion ringgit electrified double-tracking rail project in the interests of fair play, competitive  pricing,  transparency and integrity – giving the new Prime Minister, Datuk Seri Abdullah Ahmad Badawi  an opportunity to demonstrate that he is concerned not only about petty corruption but also grand corruption. 

The controversy over the award of the multi-billion ringgit double-tracking railway project is a multiple  blow to the reputation of the country, not only with regard to transparency and integrity,  our handling of international relations but also to  the new Prime Minister. 

Some three weeks have elapsed since the shock  award of the RM14.5 billion electrified double tracking rail project, the country’s single largest privatized construction project, to latecomer Malaysia  Mining Corporation Bhd -Gamuda consortium (MMC-Gamuda JV) in utter disregard of the  Government-to-Government transactions with India and China and earlier Letters of Intent issued to Indian Railway’s Ircon International Ltd. with DRB-Hicom/Emrail to handle the 328.km northern stretch from Ipoh to Padang Besar and China Railway Engineering Corp (CRET) with DRB-Hicom Hikmat Asia to handle the southern stretch of 287.5 km from Seremban to Johore Bahru. 

The award of the RM14.5 billion electrified double tracking rail project to a local consortium which had slipped up from behind and in circumstances which reeks of scandal because of the gross impropriety and  international sensitivities displayed is definitely  not a good start for the new Prime Minister, Datuk Seri Abdullah Ahmad Badawi and his pledge of a government which is “clean, incorruptible, modest and beyond suspicion”. 

The only way to cut the Gordian Knot of the controversy over the   multi-billion ringgit award for the electrified  double-tracking rail project in a way which  is fair to all interested parties as well as to the nation is for the Cabinet to cancel the award to MMC-Gamuda JV and  re-open bidding for the project by way of a public  tender to all interested parties, whether local or foreign, on a level playing field,  to ensure fair play, competitive  pricing,  transparency and integrity.  

This will give Abdullah the  opportunity to demonstrate that he is concerned not only about petty corruption but also “Grand corruption”. 

In his first week as Prime Minister, Abdullah’s focus on the war against corruption had been on “petty corruption”, or conventional bribery, which occurs when a public official demands, or expects, “speed money” or  “grease payments” for doing an act which he or she is ordinarily required by law to do, or when a bribe is paid to obtain services which the official is prohibited from providing. 

Hence, the new Prime Minister’s emphasis on the reduction of bureaucracy, cut red tape and to revamp front-line agencies in particular the land office, district office and local councils belong to this class of “petty corruption”. 

But there is another category of corruption which Abdullah has yet to address, “Grand corruption”, which occurs when  a person in a high position who formulates government policy or is able to influence government decision-making, seeks, as a quid pro quo, payment, usually off-shore and in a foreign currency, for exercising the extensive arbitrary powers vested in him or her. 

Scholars of public ethics and corruption have identified five main categories  of supply to government in which grand corruption plays a significant role, viz: 

  • The purchase of aircraft, ships and military supplies, including telecommunications.
  • The purchase  of capital goods required for major industrial and agro-industrial projects.
  • Major civil engineering contracts such as in respect of dams, bridges, highways, railways, airports and hospitals.
  • The ongoing purchase of bulk supplies, such as oil, fertilizers and cement, where distribution is through a parastatal company, or where there is a need for standardization, such as repeat orders for pharmaceuticals and school textbooks.
  • Consultancy fees, the usual beneficiary being the public official whose sole responsibility it is to select the consultants.

The re-opening of the bidding by way of open tender for the multi-billion ringgit electrified double-tracking rail project by all interested parties, whether local or foreign, on a level playing field, will remove all whiff or scandal and shadow of doubt or suspicion linking the whole controversy with “grand corruption”. 

DAP welcomes Abdullah’s statement yesterday that he had asked the Attorney-General’s Chambers to speed up several outstanding corruption cases, including the case involving national steel corporation Perwaja, as this would be the first case in the category of “grand corruption” he had adverted to in his first week in office, involving not just tens, hundreds or thousands of ringgit in the case of “petty corruption”, but billions of ringgit. 

However, why is  the Prime Minister  asking the Attorney-General to speed up the Perwaja case when Anti-Corruption Agency investigations after seven long years into the matter have not seen any light at the end of the tunnel?  Is Abdullah prepared to give MPs  a report on the latest update situation of all the outstanding  investigations into the  “grand corruption” cases before Parliament adjourns next Tuesday at the end of the budget meeting?

After his first Cabinet meeting, Abdullah announced that he had directed Ministers to set up a task force in their ministries to tighten procedures and reduce bureaucracy to spearhead the  fight against  corruption.

Ministers do not   have any  credibility to lead the   campaign against corruption in their respective Ministries  to end “petty corruption” unless they have an unblemished record and reputation on “grand corruption” – and this is why Ministers must publicly declare their assets and those of their next of kin to demonstrate that their  private wealth had  nothing to do whatever with any form of “grand corruption”.

(8/11/2003)

* Lim Kit Siang, DAP National Chairman