Today Penang MCA spokesman and Bukit Bendera MCA division chairman Tang Heap Seng urged Penang Chief Minister Chow Kon Yeow to explain officially whether the state government is proposing to build an undersea tunnel or a third bridge? How much land had the state government given to the construction consortium?

"It was reported that CM Chow Kon Yeow said that Penang state government has given land worth RM208 million to the construction consortium as fees for a feasibility study report and design of the proposed three highways."

Tang said, the said project has not even started 8 years after the contract was signed in 2013. Yet, the state government has handed over RM208 million worth of land to the construction consortium. It is doubtful to have allowed such a good advantage being given out in this deal.

My comment:

MCA is right to suspect that corruption is involved in giving out Rm 208 million worth of land to the construction consortium as fees for a feasibility study report and design in 2013. After 8 years, the consortium has not provided a design. Even if the consortium provided a design, who will be the construction contractor and what is the construction cost?

The best way for the Penang State Government is to follow the system required by ADB and World Bank to avoid corruption.

The ADB and the World Bank give out low interest loans to help poor countries to improve their economy. They insist all the borrowers to follow their guidelines for calling open competitive tenders to avoid corruptions.

A few years ago, Perak Academy invited me to talk on the subject. I am proud to mention that our Ipoh born Dr Lee Ming Tai who is a senior manager of ADB came to listen to my talk. He is now posted in Beijing.

Employ engineering consultant  

First employ a reputable engineering consultant firm with the necessary expertise to produce the design drawings, specifications and bill of quantities for the project. 

Prequalify contractors

All the contractors must be prequalified before they are allowed to submit their tenders. 

All the tenders are open publicly to show all the tendered prices and award the contract to the contractor who submitted the lowest price. 

However, contractors are allowed to submit alternative designs provided they are cheaper than the original design. In this case, the consultant would have to examine the alternative design to make his recommendation. Unless the saving is quite substantial, the consultant should not recommend acceptance of the alternate offer.

Sale of State land

In addition to the 4 types of tenders as I illustrated above, to avoid corruption, all the sale of State land, concessions for toll road, water and electricity supply   must be open for competitive tender to get the best prices.

Loopholes open for corruptions

I have to point out that there are many loopholes open for corruptions in granting the change of land use from agriculture land to building land, building density, re-zoning etc. The land value will increase many times if agriculture land is permitted to build houses. Land value will shoot through the roof if a row of single storey building is permitted to build a multi storey building such as a shopping mall, office block or condominium.

I also like to point out that corruptions are often involved in granting concessions for toll road, water supply, electricity supply, import permits etc.

Finally, if we want to reach the status of a highly developed nation, we must immediately implement the standards of economic good governance, accountability and transparency that come with it. 

Note: I have been a member of the Board of Engineers, Malaysia for 3 terms. I was the Secretary General of the Master Builders Association, Malaysia for 9 years. I was one of the co-founders of Mudajaya, Gamuda, IJM Corporation and a few other listed and non-listed companies. 

He listed out 7 doubts and requests the state government to explain to the people:

1) Generally, in initiating a big project, the fees for feasibility study and report usually would not exceed 1.5% of the project cost, and the completion period for such report would not exceed 6 months.  In this case, however, the feasibility report for the undersea tunnel and three highways, was priced at RM305million which is as high as 4.8% of the project value of RM6.3billion. Can the state government explain?

2) According to the agreement, the state government will swap 110 acres of land for the construction cost of the undersea tunnel and three highways. If the undersea tunnel is to be replaced by the third bridge which may cost only half the construction value, will the state government maintain the stand to give 110 acres of land to the construction consortium?

3) The feasibility report generally does not exceed 1.5% of the project cost. But Chow Kon Yeow said that the land valued at RM208 million is only for the swap for fees of a feasibility study report on the three highways, and does not include that of the undersea tunnel. The construction cost of the three highways is RM1.99 billion, then the feasibility study cost of RM208 million accounts for 10% of the project cost? Nearly 10 times higher than the norm. Can the state government justified such?

4) Since the undersea tunnel project agreement was signed in 2013, nothing has materialize and not even the feasibility report was published, and yet now after 8 years, why changing to proposal of a third bridge? Is the state government have any clue to have the need to replace the sea tunnel? The state government must explain whether the undersea tunnel was a big scam from the beginning? Lie to Penangites for 8 years?

5) No works have been commenced in 8 years, but the construction consortium has obtained RM208 million land and had made a lot of money by building luxury condominium there, was the state government being taken a ride of?

6) Through out the 8 years, why didn’t the Penang state government urge the construction consortium to submit the feasibility study report? Where is the contractual time line? On the contrary, the state government is only keen on reclamation in order to hand over the reclaimed land to the construction consortium, and even approved that land development proposal swiftly. Is this collusion of government versus business?

7) Who should be authorized to make public announcement as regards to proposed replacement of sea tunnel with a bridge? It is confusing that the consortium announced such, has the state government agreed to this proposal, and allowed them to release the news?

Tang Heap Seng said before the Penang state government's undersea tunnel and three highways project could materialise and benefit the people, the construction consortium has already harvested a large amount of land. Why this was consciously allowed to happen?

"It is generally felt that Chow Kon Yeow's explanation is insufficient. The people expect a more detail and official explanation from Chief Minister Chow Kon Yeow."

He said that the Penang Pakatan Harapan government is fond of “u-turning”. People are confused with the about turn of the issues of undersea tunnel and a third bridege over the sea. People have the right to know the truth and details of what is the stand of the state government, to build a tunnel or a bridge? Uncertainty after 8 years of non performing feasibility contract?