KUALA LUMPUR: The story from Bernama below is again self-explanatory. The PAC seemed to say that the decision by the government to defer the procurement of the Cougar was not a wise decision as voted for by Malaysian Defence readers. Although it had stated before that the procurement had followed proper procedures it appears the committee failed to decide whether the purchase price was fair or not and whether the Cougar was the right choice to replace the Nuri
To answer that question since the PAC is basically recommending the procurement of a Nuri replacement ASAP, there is no need for them to set-up another government-centric committee. First they need to speak to Eurocopter on the price and contract issues. Furthermore, they must get Eurocopter to reveal whether or not the price had been marked up as payment for their local agents whom identity/identities, also must be revealed. If the price was marked up for that reason, the numbers should be revised downwards if they want to continue with the procurement.
Once the local agent/agents are identified, they must also faced the committee and must reveal any dealings they had with the Defence Ministry officers and personnel to ensure that they (including Eurocopter) had not committed any illegal acts to influence the decision to choose the Cougar. This could be difficult of course as the ACA is already investigating the same case but it could be done. Should the Cougar be dropped if any illegal dealings had occurred is the decision the Government must make. Malaysian Defence believes it will be a wise decision to re-open the tender should this was the case.
And on the question whether or not its the right helo for the job, to be fair, they must also get the views of the Nuri crews themselves. A few senior pilots, load-masters and engineers may well be the best people to make the committee understand the issue.
And perhaps, the PAC could hire experts, from overseas or locals, to pore through the financial and technical documents and get the answers for them especially whether or not its wise to spend so much money during these hard times. Personally, Malaysian Defence believes that this is not a question of value for money (how do you value a good utility helicopter?) but whether or not the chosen helicopter can do better than what Nuri had done during the last 40 years.
Only then the matter could be solved as best as possible. Otherwise, the questions will always linger.
–Malaysian Defence
PAC Proposes Independent Panel To Advise Government On Eurocopter Purchase
KUALA LUMPUR, Dec 16 (Bernama) — The Public Accounts Committee (PAC) has suggested that an independent review panel be set up to advise the government on the purchase of Eurocopter’s EC 725 helicopters.
The proposal is among recommendations contained in the committee’s report on the Eurocopter deal which was distributed to members of parliament on Dec 4.
In a statement today, the PAC said, the proposal was to ensure there would be value for money in the deal.
It said that the independent panel should comprise experts in related fields, with the Economic Planning Unit of the Prime Minister’s Department managing their appointments.
“The PAC is not able to ascertain whether the cost to purchase the Eurocopter EC 725 is high or otherwise.
The PAC was told that military requirements differed from one country to another,” the statement said.
The Defence Ministry had expressed intention to buy the helicopters to replace the ageing Nuri aircraft, which it had been using since 40 years ago.
The government however decided to postpone the purchase due to the current global economic condition.
The PAC also said that the Defence Ministry and related central agency should conduct price negotiations with the aircrat’s supplier.
For that purpose, it said, market studies should be carried out as basis for the negotiations.
It was also important for the Defence Ministry to carry out test flights and physical inspections apart from monitoring the production of the EC 725 and making sure payments were made in accordance with the work progress.
There should also be a pre-delivery inspection as well as testing and commissioning prior to making the final payment, it said.
To ensure the government’s interests were taken care of in the procurement contract, the PAC suggested that the Defence Ministry seek the views of the Attorney-General before signing the contract.
The aircraft’s specification should also be spelled out in the contract, it said.
The PAC also felt that the purchase should be made at the latest by 2011 as the Nuri could only be used until 2015.
“It takes three years to prepare the aircraft and another year for flight training,” it said, adding that the government should reconsider its decision to defer the purchase of the Eurocopter.
— BERNAMA
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So far PAC has only heard from one side of the story, the govt (Mindef and MOF). They should hear from Eurocopter and its agents, and, hear from the other competitors and their agents. They could also hear external experts on certain points. Only then they could get a clearer picture, which can form the basis for PAC to support the tender result or to advise the tender be re-opened.
By passing the buck to another committee (which doesnt exist), PAC has clearly failed to discharge its duties. Worse, this new committee/panel will be an executive body and not subject to parliament oversight. An opportunity lost I think. I imagine PAC would be more effective if Sharir was still its Chairman.
Marhalim: I am of the opinion that is no need for them to speak to the other tenderers as it would be a matter of sour grapes. They will damn the deal and tarred and feathered Eurocopter without revealing their dirty tricks themselves. It is better for us to get Eurocopter to come clean and if they do not, simply order the Mindef to re-tender the programme and bar Eurocopter from it. I agree with you that the PAC failed to get to the real crux of the issue by limiting itself to getting explainations from the Govt side only. With a lap dog as its head, we cannot expect anything more from it.
PAC did the best it could to whitewash the shocking incompetence of the MINDEF and Treasury in fixing the tender in favour of Eurocopter. The problem goes far beyond just the tender since RMAF has now got to justify the gold plating on the birds for simple lift.
Sharir has been neutered since he became a Minister. I propose Rembau for the task…..:)
Marhalim,
I beg to differ on the other tenderers. If you hear just one side, you will only hear good things. Of course, there may be sour grapes on the other side but there may be some merit to their grouses.
After listening to the sour grapes, then PAC should get further clarifications from the authorities. PAC then decides whether the clarifications are sufficient. Then and only then PAC exercise its independent judgment.
btw indentity of Eurocopter local agent is known, check Tempur mag for details.
MeesterT,
I second the Rembau motion! 😉
According to Tempur (Nov 08 issue), the primary agent for Eurocopter is a company by the name of …….Sdn Bhd. Since Eurocopter is already well established in Malaysia with Eurocopter Malaysia Sdn Bhd, why the need for an agent??? Naive question I know.
Marhalim: Its how they make …..It was the same deal when they signed the NGPV project. Instead of signing with NDSB, they signed it with a little known Sdn Bhd company which in turn sub-contract it back to NDSB. The Sdn Bhd makes easily RM100 to RM300 million atas angin……That is why I want Eurocopter to say who their local agent on record so then the PAC have the locus standi to call the local agent to explain their role in the affair. At the moment, although Tempur had stated the name it remained hearsay only…..
If the agent is the correct one, I have found an entry dating from 2005 which stated that it was involved in developing a state of the art military mobile communications. The executive director of the company that was quoted at that time was a former president of KLSE.
Sorry I had to black out the name of the company and its exec director but I am concerned about legalities.
Alamak… Eurocopter Sdn. Bhd. macam mana boleh memenuhi keperluan ekuiti Bumiputera untuk projek? So must use a 100% Bumi company and kenalah bayar ‘servis caj’. It’s very difficult being a paper entity you know, have to sign paperwork etc.
This is how things are done in Malaysia. Taxpayer is very accommodating and government is very generous.
As for R&D….every time I come across a local company claiming to be doing defence R&D, I have a darned good chuckle.
Marhalim: Actually if they want to they can forego the Bumiputera equity if they want to do so, it have been done before since the goods on tender does not exist or available in country. But its the bastardization of the policy that allowed such a crappy thing to occur all the time which caused the price of defence goods to go sky high resulting in the purchase of smaller numbers with expensive price…..
Marhalim…how about you get us some skinny on our boys in action in Somalia, coming to the aid of the Zhenhua 4?
Simon
Marhalim: Will try….The only thing I got so far is that a helicopter embarked on KD Indera Sakti came to the help of Zhenhua 4 as the pirates tried to board the ship. The helicopter, I was told it was a the Super Lynx, fired off warning shots forcing the pirates to abandon the Zhenhua and flee… more details is forthcoming…
The helicopter wasnt a Super Lynx, but a Fennec “gunship”.
Marhalim: Yes, you are right, my initial info was wrong it was a Fennec. The funny thing about this incident is that the lack of silence by the RMN over the “success”. It would have been great PR after the debacle with the MISC ships. I am hearing that there is some disagreement over the role of Malaysian sailors in the shooing off operation as the Rules of Engagement have yet to be green-lighted by the powers that be especially when it comes the time to shoot at people.