The Works Ministry had to look again for a new road builder in Labuan when it found that RM52.8 million could not cover the cost for a 6.6km road. For that money, they could only get about half the length.

 

The Auditor-General Report 2013 however applauded the Works Ministry for recouping the RM10 million deposit paid to the first contractor, Pertama Makmur Sdn. Bhd.

 

The project was tendered again and this time TE Synergy Sdn Bhd. agreed to upgrade and widen the short road from Pohon Batu (Simpang Tamu) to Pancur Hitam in the federal territory with the "limited funds."

 

"However, there was an (cost) increase of RM3.64 million to RM56.44 million while the road distance was shortened from 6.6km to 3.5km. Audit findings revealed that the management of the project was satisfactory," the report said.

 

This was a project under the Ninth Malaysia Plan and the road was also widened into four lanes from two lanes. The initial contractor was terminated in October 2008 on mutual agreement that it couldn't be done so cheaply.

 

The auditor-general’s office however also noted that the "variation of price was signed by an unauthorised officer." The officer, who was the chief assistant director of road division, posed as the superintending officer’s representative.

Payment certificates were also signed by an unauthorised officer, it noted.

 

The final road condition was also less than satisfactory as there was improper maintenance such as the quality of drainage not being maintained properly.

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