KUCHING: Sarawak Building and Civil Engineering Contractors Association (SBCECA) was delighted to learn that Malaysia Competition Commission (MyCC) and Malaysian Anti-Corruption Commission (MACC) will join forces to tackle leakages in government procurement.
Its chairman Lau Pik Ting said contractors have long been suffering from unfair or unnecessary requirement by government project implementers on materials procurement where materials must be sourced from solely ‘Malaysia origin’ or ‘Sarawak-based manufacturers’ as specified under the contract.
“These products found its way to become contract requirements via products specification or instruction to bidders.
“While we definitely support any government initiative to promote local industries as per List of Materials of Malaysian Origin provided by the relevant ministry, there are two construction industry products not in the list, which can only now be sourced under monopolistic restrictions,” he said today.
SBCECA suggested that MyCC and MACC take actions on two cases namely, geotextile as well as pipes and fittings for water supply projects in Sarawak.
On geotextile, he pointed out that the current monopolistic supply situation was suspected to be arising from possible ignorance/lack of vigilance/collusion with vested interests as the requirement was inserted via a clause in the Specifications for the Tender Documents when there had been no directive from the relevant ministry to do so, namely for the material to be made in Malaysia.
“Geotextile was never listed as one of the 38 products in the List of Materials of Malaysia Origin issued by the Treasury. However, geotextile is found to be widely specified (as if it is a product in the List of Materials of Malaysian Origin only sourced from a Malaysian manufacturer) by project implementing agencies like Department of Irrigation and Drainage (DID), Public Works Department (JKR), Regional Corridor Development Authority (Recoda), and Ministry of International Trade & Industry, Industrial Terminal & Entrepreneur Development Sarawak (Mintred) to name a few in Sarawak.
“Contractors are accordingly forced to purchase geotextile from a ‘sole Malaysian manufacturer’ or through its sole agent in Sarawak at a much higher price as compared to equivalent imported geotextile.
“This requirement by virtue of an unnecessary contractual requirement, without the express support of the government, benefitting only one ‘Malaysian manufacturer or its Sarawak agent’ can only cause unnecessary loss to the government and the people. There are issues related to possible leakage and monopoly practices/abuse of dominant position,” he explained.
Lau further said the state government imposed a requirement to purchase pipes and fittings for water supply project implemented by Sarawak Rural Water Supply Department (JBALB) to be from local Sarawak based manufacturers through its Tendering Conditions and subsequent tender clarifications.
“Again, this practice limits healthy competition as the cost of supply is 20 to 30 percent lower if coming from Malaya. This requirement is also monopolistic as well as restrictive and should be investigated.
“We trust investigations by MyCC and MACC will help to change the government procurement policies to tackle leakages and encourage healthy competition in accordance with Competition Act 2010,” he added.
