Wednesday October 17, 2012
Firm yet to carry out projects worth RM195mil
DESPITE receiving 290.07ha of land from the Kelantan Government in a joint-venture deal, a firm has yet to fulfil its end of the bargain to build a mosque, stadium and bridge worth RM195mil.
The Auditor-General's Report revealed that Syarikat Liziz Standaco Sdn Bhd had signed a deal with Kelantan to undertake the Sungai Kelantan river bank beautification project in 2003, and its progress was deemed “unsatisfactory”.
Among the terms of the agreement was for the state government to give about 404ha of land around Lembah Sireh to the company in exchange for contribution in the form of financial and physical development valued at RM350mil.
The contributions by the company that were agreed include a RM20mil mosque, a RM150mil bridge linking Kampung Cina and Palekbang and a women-only indoor stadium costing RM25mil.
However, the audit findings revealed that Liziz Standaco had yet to construct any of the projects as of December last year, which were supposed to be completed by November 2007.
The company was also supposed to give RM90mil in cash to the state government after the construction of the bridge was given to the Federal Government.
On-site audit checks found that only one zone Zone D, where the Kota Baru Tesco Hypermarket is located out of four designated in the river bank beautification project, had seen some development.
Among the reasons given by the developer for the project delay were increase in raw material costs and that many of the projects involved “infrastructure costs that do not generate profit for the company”.
The Auditor-General also felt the transfer of land to the developer was a “huge risk” to the state government, in the event that the project was not completed according to the deal.
It was also pointed out that the company had not submitted a “performance guarantee bond” and no detailed study and project evaluation was done.