Zahid vows to cooperate on probe into ship project

Malaysia's former defence minister Ahmad Zahid Hamidi said the contractor's failure to deliver the ships was highlighted after his tenure.
Malaysia's former defence minister Ahmad Zahid Hamidi said the contractor's failure to deliver the ships was highlighted after his tenure.PHOTO: BERNAMA

PETALING JAYA • Malaysia's former defence minister Ahmad Zahid Hamidi has said he will give his full cooperation to help Parliament's Public Accounts Committee (PAC) in its investigation into a RM9 billion (S$3 billion) littoral combat ship project.

It has been reported that the government paid RM5.94 billion to contractor Boustead Naval Shipyard (BNS) for the project that was commissioned in 2014.

The first of the ships, meant to patrol Malaysia's coastal waters, was set to be delivered in April last year. But none of the ships has been built.

Zahid said the contractor's failure to deliver the ships was highlighted only last year, long after his tenure as defence minister.

"I would also like to state that these ships are being tasked to BNS, which is owned by Boustead Holdings Berhad, and two of its largest shareholders are the Armed Forces Fund Board and Retirement Inc Fund, both of which belong to the government," he said in a statement yesterday .

The PAC is a body comprising both government and opposition MPs set up by Parliament to look into government spending.

Zahid also said the contract was awarded in accordance with the Guidelines for Application of Direct Negotiation Procurement, which state that the procurement of projects, particularly by way of direct negotiation, can be made only upon approval by the Finance Ministry, not the defence minister.

On the issue of late delivery fees last year, Zahid said the Defence Ministry had clarified that it had forwarded a letter of demand to recover the fees from the responsible party to a controlling officer for approval, but it was to no avail.

"Lastly, I believe that the Ministry of Defence had also made clarifications on the issue of progressive payments. I strongly affirm that the payments were made in 2019 when I was not the Minister of Defence.

"Therefore, I had no knowledge and control over any decisions made by the ministry to proceed with the progressive payments," he said.

He said he understood that PAC is responsible for enhancing and maintaining the government structure and administrative framework of accountability in Malaysia.

"However, I strongly believe that PAC should exercise more caution to disclose details of the ongoing investigation, particularly on matters of national security, especially when this is at an investigative stage and no findings have been established yet.

"This contention, however, should not and will not defeat my intention in giving full cooperation and my best ability to assist the committee in the ongoing investigation, " added Zahid, who was also a former deputy prime minister.

On Thursday, PAC chairman Wong Kah Woh said in Parliament that several individuals, including Zahid, would be questioned by PAC over the project.

Mr Wong also said former navy chief admiral Abdul Aziz Jaafar and a representative from BNS will be questioned in the proceedings that will resume early next month, followed by a visit to the ship construction site in Lumut, Perak.

THE STAR/ASIA NEWS NETWORK

A version of this article appeared in the print edition of The Straits Times on December 19, 2020, with the headline 'Zahid vows to cooperate on probe into ship project'. Print Edition | Subscribe