Outsourcing of management and operations of Bukit Jambul Country Club

Press Statement by Penang Chief Minister's Office in Komtar, George Town on Tuesday, 2^nd February 2010:

Outsourcing of management and operations of Bukit Jambul Country Club

Penang Chief Minister Lim Guan Eng in his capacity as Penang Development Corporation(PDC) Board Chairman has directed PDC to reveal the chronology of events relating to the proposed privatization of operations in the Bukit Jambul Country Club(BJCC). BJCC is run by Island Golf Properties Bhd(IGP), a PDC owned subsidiary company. Bayan Baru MP Dato Seri Zahrain has been the Chairman and Director of Island Golf Properties Bhd since 9th July 2008. Information supplied from PDC is as follows:-

Outsourcing of management and operations of BJCC:

Chronology of Events

No.	Dates	Particulars
1.	28 July 2008	IGP Board at meeting No. 2/2008 suggested that IGP Management study the proposal to outsource the operations of BJCC and if necessary to work with consultants on the details of the outsourcing aspect.
2.	16 Aug 2008	IGP called for quotations from 5 companies to advise and give suggestions on how to improve the operations of BJCC.
3.	21 Aug 2008	On the date of closing of quotations, two (2) quotations were received: Greenpeas Communications Sdn Bhd – RM80,000 Nigel B Douglas (M) Sdn Bhd - RM52,500
4.	25 Aug 2008	IGP Board at its meeting No 3/2008 appointed Nigel B Douglas (M) Sdn Bhd as the golf consultant to study and make recommendations on the process of outsourcing.
5.	3 Dec 2008	An open tender was advertised in ‘The Star’ newspaper to invite tenders for the outsourcing exercise.
6.	10 Dec 2008	On the date of closing, only one (1) company submitted the tender. That company was established on 29 Sept 2008 with an authorized capital of RM100,000 and an initial paid-up capital of RM2.00.
7.	12 Jan 2009	IGP Board at its meeting No 1/2009 recommended the following:- Agreed in principle that the management of BJCC be outsourced to the RM 2 company subject to the approval of PDC Board. Nigel B Douglas shall be retained to advise and assist in the outsourcing process.

PDC Board meeting on 10 February 2009 agreed with the IGP’s Board’s proposal for outsourcing the operation of BJCC but rejected its recommendation that the RM 2 company be selected. Instead the PDC Board agreed with the Chief Minister’s recommendation that fresh tenders be called.

The Chief Minister had based his recommendation for fresh tenders for the management of BJCC on two important reasons. One, to allow a RM 2 private company to win the tender for running BJCC, that involves expenditure of tens of millions of ringgit, would make a mockery of the meaning of open tender system. Two, the RM 2 company had no track record of running a golf club and was established on 29 Sept 2008, clearly with the sole intended purpose of bidding for the tenders.

The Chief Minister has refused to heed requests to follow the recommendation of the IGP to select the RM 2 company. Instead he had insisted that a fresh tender must be held in line with the CAT governance of competency, accountability and transparency. The fresh tender exercise was carried out with 7 proposed tenders received. The tender award is in the process of being finalized and will be decided by the full PDC Board meeting on 9.2.2010.