Friday 29 Mar 2024
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This article first appeared in The Edge Malaysia Weekly, on October 12 - 18, 2015.

 

OVER the past few weeks, contractors involved in the extension of the Ampang LRT line — be they public-listed companies or private outfits — have been blaming each other for the delay in the job.

However, the spotlight is on George Kent Bhd, which, together with Malaysian Resources Corp Bhd (MRCB), has been appointed the project delivery partner (PDP) for the RM9 billion LRT Line 3 (or Bandar Utama-Klang Line) project.

The main complaint is how George Kent, whose expertise lies in water meters, can handle the role of PDP for a large-scale rail project. “They [George Kent] have come in for a lot of flak for the delay in the Ampang LRT extension. If those allegations are true, why give the company more jobs and responsibility, this time as the PDP for the RM9 billion LRT3?” asks an industry player.

To recap, George Kent and privately held Lion Pacific Sdn Bhd were awarded a RM1.1 billion contract by Prasarana Malaysia Bhd for the “engineering, procurement, construction, testing and commissioning of system works” in the Ampang LRT extension project.

A familiar refrain is that George Kent gets jobs through its political connections. Contractors familiar with the company say it could always hire experienced rail executives with the requisite expertise while people close to the company defend it by saying it has won (water meter) contracts in Hong Kong and Papua New Guinea, which gives it credibility.

A contractor, who is obviously at odds with George Kent, says, “From what I know, they [George Kent] contributed to the overall delay [in the Ampang LRT extension] due to their failure to commence the system works on time after the completed facilities were handed over to them ... George Kent is significantly behind schedule.”

He adds that he had heard that George Kent “had insufficient resources with the relevant technical competence to manage or challenge their subcontractors”.

He says awarding local companies contracts so that they gain experience is preferable to awarding them to foreign outfits.

That said, some quarters believe George Kent should not be made to walk the plank alone. Opus (M) Ace Vector Consortium, the project manager for the Ampang LRT extension, should also take some responsibility for the delay, says an industry player.

“There are three stages to look at. There is land acquisition, a detailed design and implementation on the site. All of this requires approvals, which can only be obtained by the project manager … so to blame George Kent alone is unfair. I hear a lot of the approvals were not obtained.”

He adds that Opus Ace Vector, which comes under UEM Group, had awarded Propel Bhd (formerly Projek Penyelenggaraan Lebuhraya Bhd) — which is said to belong to the same stable — the utility relocation works involving the relocation of water pipes, gas pipes and even telephone cables.

Another contractor familiar with UEM Group disagrees. “The project manager’s role is to manage the project that it has undertaken and deliver it on time, within budget and with the highest quality … a project manager does not appoint consultants or contractors. All contracts are awarded by Prasarana through competitive bidding, open tenders and pre-qualification exercises.”

In other words, he says, Opus Ace Vector should not be blamed when other contractors cannot deliver.

George Kent and UEM Group declined to comment, saying that they had signed non-disclosure or confidentiality agreements with Prasarana.

The Edge did not speak to Prasarana but according to industry players, the government agency is keeping mum about the matter.

There are many unanswered questions and no clarity as to who is to blame for the delay.

George Kent executive chairman Tan Sri Tan Kay Hock had admitted it to the media, saying, “There will be some delay [in the Ampang LRT extension] but we will try to catch up. It could be delayed by a year.”

But a few days later, Prasarana executives claimed that there was no delay; they said Phase 1 was on track to be completed by the end of this month and Phase 2 by March next year.

The Edge learns that there is a recovery measure in place. “A revised programme was established whereby an acceleration arrangement has been implemented. Under this arrangement, three of the four facility contractors are progressing and narrowing the gap,” says an industry source, adding that with the acceleration, there will be no delay.

The question is, will the acceleration add to the costs?

The blame game in the Ampang LRT extension project is not the first in the country. Not too long ago, there was a similar situation in the construction of klia2.

While finger-pointing continues to thrive, the government should implement a framework that will hold parties that cause delays, defects or cost overruns in projects accountable.

With the large number of public contracts up for grabs, greater transparency and accountability is needed in how they are awarded and executed, especially when things go awry.

For rail projects, perhaps the 18km Ampang LRT extension and 17km Kelana Jaya extension should be used as the test cases for other jobs.

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