Today, officials from the Minister of Education (MOE) will be appearing before the Parliamentary Accounts Committee (PAC) to answer questions regarding the many concerns about the 1BestariNet project raised by the 2013 Auditor-General’s Report.
At a cost of RM4.1 billion over 15 years, the 1BestariNet project encompasses the installation of 4G high-speed Internet broadband across all 10,000 schools throughout the country, as well as a Virtual Learning Environment (VLE) e-learning system to be used by 5.5 million students and 500,000 teachers nationwide.
Despite repeated assurances by the MOE that the project has been a success, the Auditor-General’s Report last year had confirmed what many of us had suspected from the beginning – that it was an overly ambitious project with questionable implementation and full of contractual irregularities that benefited the contractor, YTL Communications Sdn Bhd. Worst of all, it appears to be heading the way of many other white elephant ICT (information and communications technology) projects before it.
Wisdom of the project
To begin with, the PAC should address the wisdom of the massive project, particularly how it was implemented in a “big bang” approach. Any IT consultant would advise that a project of this scale, covering 10,000 sites in every corner of the country and involving stakeholders such as teachers and students of various backgrounds and skill-levels, should have been implemented in phases, beginning with a pilot project. The question is, therefore, why was it rolled out in one go?
The tender award
When the project was mooted some four to five years ago, the Ministry had initially called a tender to provide high-speed Internet broadband in all schools. 19 companies including major players such as Telekom Malaysia, Time dotCom, Maxis and Celcom Axiata, all of which had a more established existing broadband network, took part in the tender exercise.
However, YTL was said to have won the bid as they threw in the extra VLE component as part of the package. However, this component has ended up with MOE having to fork out RM250.5 million for licensing fees and RM262.8 million for management and maintenance costs in a rolling contract renewable every 2.5 years.
Contractual Irregularities
The Auditor-General’s Report revealed a string of irregularities and non-conformance in the implementation of the project. For example, complete roll-out of the 4G Internet broadband infrastructure had been due to be completed by 30 March 2013, but only 59.3 per cent or 6,092 schools had received it. By 12 June 2014, only 88.9 per cent had been completed, still short of the contracted target.
The audit report also stated that the project suffered from lack of value management, failure to obtain technical approvals from MOE and the Malaysian Administrative Modernisation and Management Planning Unit (MAMPU), as well as failure to conduct a School Needs Assessment before installation of the infrastructure. As a direct result, 58 per cent of 501 schools surveyed by the National Audit Department reported that the 1BestariNet service did not cover the entire school compound, even though it was contractually obligated to do so.
In addition, 89.1 per cent of 46 schools tested and 70.3 per cent of 491 survey respondents revealed that broadband speeds averaged between only 0.2Mbps to 3.62Mbps, which is far lower than the contractually promised 4Mbps to 20Mbps.
Alarmingly low usage
Another shortcoming highlight by the audit report was the alarmingly low level of take-up. Despite the fact that 8,886 schools had already been equipped at the time of audit, login statistics showed only 0.01 to 4.97 per cent usage. More worryingly, usage amongst students ranged from only 0.17 to 0.64 per cent. Today, I have received complaints from teachers who are apparently “forced” to use the VLE system, in order to increase login statistics.
1BRIS towers
One major point of contention is the installation of the 1BestariNet Receiver Integrated System, or 1BRIS towers. According to the terms of the contract, these telecommunication towers would be installed at school premises in order to receive and relay high-speed wireless signals.
Unfortunately, the initial agreement between YTL and MOE did not stipulate rental charges for the use of school land. However, the MOE subsequently charged YTL RM1,000 a year for each site, despite the fact that the Valuation and Property Services Department (JPPH) had recommended a monthly rental of RM1,200, as per market norms. With 3,203 1BRIS towers installed, the MOE should be receiving RM46.12 million a year in rental revenue based on a fee of RM1,200 a month. However, YTL only pays RM3.2 million a year, which equates to loss of revenue amounting to RM42.92mil a year.
In addition, the contract did not specify who should pay the utility charges arising from the 1BRIS towers. As a result, schools end up picking up the tab. According to the Auditor-General’s Report, electricity costs in schools increased by an average of RM150 to RM180 a month as a result of the 1BRIS towers. This amounts to an extra energy bill of between RM5.77 million to RM6.92 million a year that is subsidised by the MOE for the benefit of YTL.
Not only is YTL enjoying savings of nearly RM50 million a year, which amounts to RM750 million over the 15-year timeline of the project, the 1BRIS towers are also used to provide YTL’s commercial YES 4G broadband services to residents in the surrounding community, thus allowing YTL to rake in even more profits. Truly, it would appear that 1BestariNet is the proverbial goose that lays golden eggs for YTL.
Therefore, it is sincerely hoped that today’s PAC meeting would get to the bottom of this colossal project that appears to benefit YTL more than it does our education system.