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4 theSun | FRIDAY MAY 29 2009

news without borders

20 issues require attention


of PKA, says report
by Giam Say Khoon » PKA failed to alert the cabinet in ing costs had it complied with the » PKA may not have received value
newsdesk@thesundaily.com a timely manner of its inability to ministry’s recommendation to issue for money due to its heavy reliance
finance the project from its internal government-guaranteed bonds and on KDSB as the turnkey developer.
PETALING JAYA: In- funds. developed the project in phases. » project management and control
ternational audit firm » the PKA board did not exercise » the land was acquired at special over the project was weak.
PricewaterhouseCoopers oversight and adequate governance value which exceeded market » as at Dec 31 last year, only the
(PwC) identified 20 issues in over the implementation of the value. light industrial units had been issued
connection with the Port Klang project » KDSB may have overcharged PKA with Certificate of Fitness but the
PKA chairman Datuk Lee Hwa Beng and PwC
Free Zone (PKFZ) project which » the advice of the attorney-general for interest between RM51 million defect liability period had expired
require the attention of the board of was not sought and certain Finance and RM309 million in connection with on Nov 7, 2007 and certain defects
managing director Chin Kwai Fatt with the PKFZ
the Port Klang Authority (PKA). Ministry regulations were not the purchase of the land and the PwC remain to be rectified.
audit report
The report categorised the is- complied with as the 2006 Auditor- had informed the PKA management
sues under five broad areas – the General’s Report had also said that to refer the matter for legal advice. PKFZ’s ability to meet financial
authority to enter into agreements; “given the scale of the project, » the supplement agreement (DA3) obligations
Call EPF’s call centre financial implications of the agree-
ments; project management and
advice from the Attorney-General
Office should have been obtained to
to the development agreement
signed between PKA and KDSB in
» PKA has projected that it will be
in a cumulative cash deficit position
for speedy service status; ability to meet financial
obligations; and financial position of
safeguard the interests of PKA and
the government”.
March 2004 was not a fixed sum
contract and did not stipulate a rate
in 2012 and will not be able to repay
the Finance Ministry’s soft loan
by Tan Yi Liang PKFZ Sdn Bhd. » there could be potential conflicts for professional fees claimable by instalments from that time on.
of interest arising from the involve- KDSB. » letters of support issued by the
newsdesk@thesundaily.com
Authority to enter agreements ment of parties who had prior » PKA incurred claims of RM95.256 Transport Ministry could not be
BANGI: Get speedy services from the Employees » although the proposal to purchase association with either the land or million for general preliminary costs construed as a guarantee that PKA
Provident Fund by using its call centre during off- the 999.5-acre Pulau Indah land Kuala Dimensi Sdn Bhd (KDSB), the not expressly specified in the devel- would meet its obligations on a full
peak periods, EPF deputy CEO Hizwani Hassan for the PKFZ was approved by the company that sold the land to the opment agreement, and the PKA and timely basis.
said. cabinet, subsequent development PKA and was subsequent appointed board had to arbitrate in respect of » the project’s actual occupancy of
“The best times to call are from 7.30am to proposals were not tabled to the project developer. this claim by KDSB. 14% is low and it is not generating
10am, noon to 2pm, and 4pm to 7.30pm, when the cabinet for approval. » the final account for DA3 did not sufficient revenue to cover its oper-
staff are free,” he said at the EPF’s Call Manage- PwC opined that since the prior Financial implications of the include any deduction for value of ating expenses.
ment Centre (CMC) here yesterday. approval of the cabinet had been agreements of the PKFZ work not done on three infrastructure
“Our peak hours are from 10am to noon and obtained for the land purchase, » the interest on the Finance Minis- components (monsoon drain system, Financial position of PKFZ Sdn
from 2pm to 4pm. There isn’t much work at the CMC subsequent proposals to develop try soft loan will increase the project water supply system and two bridges) Bhd
during lunch time, while these are peak hours for the land should also be tabled to outlay from RM4.947 billion to in the land purchase agreement. » the company has incurred losses
EPF counter staff,” Hizwani said. the cabinet. The total value of RM7.453 billion and the total outlay since its incorporation and has nega-
“The CMC, open from 7.30am to 7.30pm from the subsequent development will increase to RM12.453 billion un- Project management status tive shareholder’s funds as at Sept
Monday to Friday, is a major cost saver. If we open agreements of RM1.846 billion is less the soft loan with the interest at » the RM1 billion development 30 last year.
a branch, it will cost a lot of money. One branch more than the land purchase price of 4% per annum over a 20-year period contract was awarded to KDSB nine
costs us half a million ringgit. We can give the sav- RM1 billion and thus would warrant is restructured. months before a project masterplan Visit www.pka-report.com for the
ings to members in the form of dividends.”
The centre currently receives about 3,000 calls
deliberation by the cabinet. » PKA could have reduced its fund- was finalised in December 2004. full report.
daily nationwide.
Asked why it is not open 24 hours or at weekends,
Hizwani said: “People seem to prefer calling during
work hours. We have tried opening on weekends but
‘Parties in potential conflict of interest’
response has been poor.
“You can call the CMC to make queries, down- PETALING JAYA: The Port Klang surveyor for KDSB in relation to the
load forms online and visit the counter just once, Free Zone (PKFZ) report yesterday infrastructure works under the land
and the money is paid directly into your account. In identified a number of parties with purchase agreement signed be-
the past, you had to come once to make enquiries prior association to either the Pulau tween PKA and KDSB in November
and pick up forms, a second time to submit forms, Indah land where the project sits or 2002.
and again to collect a cheque,” he said. “The centre Kuala Dimensi Sdn Bhd (KDSB), the “Given its prior involvement as
will also call to let you know the money has been developer for the project, which KDSB’s quantity surveyor, Perunding
credited.” may have given rise to potential BE Sdn Bhd may have put itself in a
Call the centre at 03-8922 6000. conflicts of interest. position of conflict of interest when
Among the names are Deputy it was appointed as a member of
Finance Minister Datuk Chor Chee Flashback: theSun’s story on May 6, 2009 QS4,” it said.
Heung and Umno’s Sementa assem- The report also named Rashid
blyman Datuk Abdul Rahman Palil. works under DA3 during the period Bhd (KPPLB), which was the original Asari & Co, which had acted in the
Join us this Sunday The report found that Chor was from July 2004 to November 2006, owner of the PKFZ land and had sale and purchase of part of the

@ Calvary Church!
the non-executive deputy chairman during the time Chor was the queried a proposal for compulsory land between KPPLB and KDSB in
of Wijaya Baru Global Bhd (WBGB), non-executive deputy chairman of acquisition of the land over direct 1995 and later as the legal adviser
Assemblies of God the holding company of KDSB, from WBGB,” the report said. purchase. for PKA.
DAMANSARA HEIGHTS April 2004 to July 2007 and the Port It said the minutes of the board “Given that compulsory acquisi- “Good practice would require
2, Jln Damansara Endah, Damansara Heights, 50490 KL
Klang Authority (PKA) chairman from did not indicate that Chor had either tion would have benefited PKA, the this earlier involvement to be
Worship Services @ 8am 10.30am 5pmO O
April 2007 to March last year. declared his previous involvement in rationale of Abdul Rahman raising declared to PKA board prior to the
Interpretation into Bahasa Malaysia “In February 2008, the final ac- WBGB to the PKA board or withdrew the query is unclear,” the report firm’s appointment as PKA legal
& Cantonese at 10.30am count for the DA3 (the supplement himself from the deliberation. noted. advisers. Whilst PKA does not have
SCG & CW @ 8am 10.30am O
agreement to the development The report found that at one The report also named Perund- a written policy of using only mem-
DAMANSARA PERDANA agreement signed between PKA and board meeting, Abdul Rahman, ing BE Sdn Bhd, which is a member bers of its legal panel, we (PwC)
4th Floor, 20 Jln PJU 8/5G, KDSB in March 2004) of RM1.216 who was the member of the board of QS4, the consortium of quantity noted that Rashid Asari & Co was
Bandar Damansara Perdana, 47820 PJ billion was approved by the (PKA) from 1997 to 2003, had declared surveyors appointed by PKA to as- not on the panel of legal advisers
Worship Service @10.30am board. his position as the president of Ko- sess the final cost of the project. The of PKA at the time of their appoint-
Interpretation into Bahasa Malaysia “KDSB carried out construction perasi Pembangunan Pulau Lumut company had acted as the quantity ment,” the report said.
SCG @ 9am & CW @10.30am
CHERAS
2nd & 3rd Floor, Block C, Lot 18113,
off Jln Cerdas, Taman Connaught, 56000 KL
Govt must walk the talk, says Ong
Worship Service @ 9am
Interpretation into Cantonese » From Front Page of the job”. » improve on governance issues at the man-
SCG @ 10.45am & CW @ 9am “We need now to seriously act on its find- agement and board levels of the PKA.
AMPANG
» the advice of the attorney-general was not ings to make sure the interests of the people » further beef up the day-to-day manage-
sought and certain Finance Ministry regula- are fully protected and that this government ment of the PKFZ to improve operations and
7th Floor, Wisma Central, Jln Ampang, 50450 KL
tions were not complied with. walks the talk,” he said. financial returns.
Worship Service @ 10.30am
Interpretation into Cantonese » there were potential conflicts of interest PKA chairman Datuk Lee Hwa Beng has At a press conference in Klang, Lee said
SCG @ 9am & CW @ 10.30am arising from the involvement of parties who been directed to submit a copy of the report the report was released in its entirety but
SCG|School of Christian Growth (Bible Study classes) had prior association with either the land or to the MACC, which he will do this morning, warned that the media should not come out
CW|Carpenter’s Workshop (Children’s programme) the contractor. and to Parliament’s Public Accounts Com- with any conclusion based on the PwC report
» the contractor may have overcharged mittee. as the audit firm was not obliged to respond
For non-Muslims only

Tel: 03-7728 6000 the PKA for interest in connection with the Ong also directed the PKA to act on the to any matter based on the report.
http://www.calvary.org.my purchase of the land. following: The full report (without appendix) will be
In a statement posted on his blog (www. » seek legal recourse for contractual short- available on www.pka-report.com until June
ongteekeat.net), Ong said the release of the comings or irregularities. 10. The public may visit the PKA office to
report, officially called the “Position Review » seek professional advice on the view 15 sets of documents (appendix), which
of Port Klang Free Zone Project and Port restructuring of financial obligations of the will be made available for two weeks during
Senior Pastor: Rev. Tan Sri Prince Guneratnam, M.A., D.D., D.Litt., LLD. PKA.
Klang Free Zone Sdn Bhd”, was a “small part office hours.

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