BN: Explain RM61.5mil profit on RM51.8mil revenue for Penang tunnel road project

(The Star) – The Barisan Nasional strategic communications (BNSC) team continues to press for answers into Penang government’s overpayment of consultation fees for the proposed undersea tunnel.

BNSC deputy director Datuk Eric See-To in a statement on Wednesday highlighted the profitability of a special purpose vehicle (SPV) company that was set up specifically to deliver the mega-project, which he claimed had already been paid RM209mil in fees for the three roads totalling 20km.

See-To said checks done with the Companies Commission of Malaysia (SSM) found that the financial performance of the SPV company’s financial statement ending August 2015 showed a pre-tax profit of RM61.5mil from sales revenues of RM51.8mil on a paid-up capital of just RM8mil.

“As none of the roads have yet to start construction with a delay of at least three and a half years, this suggests that the stellar sales revenues and profits for that year must have come from the consulting fees of RM209mil and/or from the land given as payment by the Penang state government,” he said.

See-To then questioned how the SPV company could have made a pre-tax profit of RM61.5mil, which is three times higher than a reputable engineering firm listed on the Bursa Malaysia even though it had a larger client base.

Penang local government committee chairman Chow Kon Yeow, had in a press conference on June 24 denied allegations that the state had paid four times more than the standardised gazetted scale of fee for professional engineering consultancy.

See-To also said after investigating and consulting with various bodies, the 10 other job scopes such as land survey, detailed environmental impact assessment (DEIA), land tunnel design, architectural design, civil and structural consultation, mechanical and electrical design, project management, social and traffic impact study and the financial feasibility and funding management, which was mentioned by Chow, was found to be sub-components of either the feasibility studies, detailed design and the DEIA.

“We advise the Penang state government to study the Registration of Engineers Act 1967 to determine what engineering services scope is within the scale of fees and also to take heed of the findings of the Board of Engineers as well as the Works Minister before giving inaccurate and invalid excuses,” he said.