'Jepak threatened to stop diesel supply to schools in demand for payment'

ROSMAH TRIAL | The Kuala Lumpur High Court today heard that Jepak Holdings had threatened to stop the supply of diesel to power 369 schools in rural and remote areas of Sarawak in 2017.

According to Treasury deputy secretary-general Othman Semail's (above) testimony, the company had allegedly made the threat to force the Education Ministry into paying them RM92 million of interim payment.

It had been heard earlier in the trial that the government was reluctant to release the payment to Jepak, as the company had not followed necessary financial procedures required by the Finance Ministry (MOF) for government projects.

"I confirm that this letter was the one I am referring to. My signature could be seen on the second page.

"From this letter, the Education Ministry is required to make interim payment of RM92,073,160.67 to Jepak immediately as Jepak at that time had threatened to stop diesel supply to 369 schools in the rural areas of Sarawak, which were relying on diesel gensets," Othman told the court earlier this afternoon.

He was testifying about a letter from MOF to the then Education Ministry secretary-general Alias Ahmad, dated July 31, 2017, which spoke about the payment to Jepak.

Othman, who is the seventh prosecution witness, was the MOF's Government Acquisition Department head during the material time of the incident.

Earlier in the day, Othman testified on how MOF had prior to this refused to pay Jepak for works it had carried out.

"Due to the failure to abide procedures (ketidakaturan prosedur) in the issuance of the Letter of Award (LA) to Jepak to carry out the solar hybrid project, the Education Ministry faced problem in paying Jepak's claims for works it had done.

"This happened because the Finance Division of MOF refused to pay Jepak's claims due to absence of complete documents to support their claims, like documents relating to price negotiations," he said.

During the earlier part of the trial, which entered its seventh day today, the court heard that the Education Ministry had to award the LA to Jepak in 2016 before due processes were completed, including proper negotiations on pricing and value for money.

This had happened allegedly because of orders the ministry had received from the then prime minister and finance minister Najib Abdul Razak, who minuted to the then education minister Mahdzir Khalid (above) to approve the project as proposed by Jepak in its proposal made in late 2015.

Jepak is at the centre of a scandal involving a RM1.25 billion project to supply solar hybrid systems to 369 schools in Sarawak.

The project is the subject matter of three corruption charges which have been slapped against the wife of Najib, Rosmah Mansor, who had allegedly played her part to ensure the contract gets to Jepak. - Mkini