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Thursday, August 3, 2017

Treasury: Even if PM wants direct tender, MOF committee reviews it

Directives from the prime minister regarding project tenders are still subject to review by the Ministry of Finance's procurement committee, said Treasury secretary-general Irwan Serigar Abdullah.
He said the procurement committee reviews all project contracts, whether it is through direct, limited, or open tender.
"So it will be a committee decision, and we evaluate, we go into the technical viability, and so on.
"So even if there is (a letter) with the prime minister's signature or any ministers' directive, it goes to the committee and we follow the standard operating procedures," he added.
Irwan was speaking at a media town hall on the 2016 audit report published on Monday in Putrajaya this afternoon.
He was asked what the government intended to do to limit direct tenders, specifically in the wake of the audit report which highlighted that several problematic projects, including the delayed Bera Hospital, had gone through direct or limited tender.
In the case of Bera Hospital, the audit report said it was the finance minister who ordered that the appointed contractor is engaged through direct negotiation.
Irwan defended the use of direct tenders in government projects, saying it was done at times to "save time and cost."
He added that even notable companies who win contracts through open tender can face difficulties and project delays. 
However, he said, the use of direct tenders is being reduced. 
He said that only 39 percent of government contracts were awarded last year via direct tender, compared to almost 60 percent through open tender. 
Another one percent of projects were awarded through limited tender, he said. 
Later, when commenting on the state of the economy, Irwan related how the Mass Rapid Transit (MRT) project had helped Malaysian maintain its "A-" credit rating with Fitch Ratings. 
"When Fitch Ratings came I took them to the Tun Razak Exchange (TRX) city. 
"I went 40 feet underground to show them the MRT station, to show that we are equivalent to the developed nations. 

"And they were very impressed. Immediately they said 'we will maintain your 'A-' rating'," Irwan said. 
It is not clear when this occurred, but Fitch Ratings maintained Malaysia's credit rating as "A-" with a stable outlook last August. 
Irwan also said that the government's growing guaranteed debt to pay for development would bring economic prosperity in the long run. - Mkini

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