Tee Keat questions PKA bond repayment
The former MCA president said one factor influencing PKA’s decision to hold back monies was the outstanding allegations of fraudulent claims made on projects, especially new additional development work, where no work had been carried out.
“Do you think that you’d still want to pay them?
The former transport minister said the government should ask PKA about its refusal to pay instead of forcing the payment by the deadline this Saturday.
“We must look at both sides of the story — the justifications, the rationale — given by PKA as to why they chose to defer payment,” Ong told The Malaysian Insider last night.
The former MCA president said one factor influencing PKA’s decision to hold back monies was the outstanding allegations of fraudulent claims made on projects, especially new additional development work, where no work had been carried out.
“Do you think that you’d still want to pay them?
“That explains why the panel that I formed to probe into the possible wrongdoings and the 20 points raised by PwC (PricewaterhouseCoopers) in the review report made such a recommendation to the PKA board [to defer payment],” Ong explained.
He was sceptical of the government’s argument that failure to pay bondholders would lead to adverse effects on the local bond market.
“The payment that was due on June 30 last year; when it was deferred, we saw no crash.
“But, of course, ultimately after several days the PKA board was told to pay,” Ong revealed.
The government yesterday ordered PKA to honour its final bond obligation to FZCB despite the board’s ongoing suit against turnkey contractor Kuala Dimensi Sdn Bhd (KDSB).
Transport Minister Datuk Seri Kong Cho Ha had said that the ministry would stick to the original schedule set before, which stipulates that the board had an obligation to fulfil a final payment of RM372 million, a second part of the RM723 million repayment due to bondholders this year.
Of the total, PKA is obliged to pay RM222.58 million to FZCB and the remaining RM150 million to the special port vehicle (SPV) by July 31 this year.
