The federal government will expedite the channelling of up to RM350 million for the first phase of the dilapidated school repair project in Sarawak as soon as the state government repays its debts of the same amount to the federal government, Finance Minister Lim Guan Eng said.
In a statement today, Lim said the state government still owes the federal government RM2.352 billion as of June 30 this year.
He said the government had basically agreed to accept the amount as part of the state government’s loan repayment amounting to RM1 billion, to repair dilapidated schools in the state, subject to the four legal mechanisms agreed by both sides.
The minister said under the legal mechanisms, Sarawak must pay up to RM1 billion from its total debt to the federal government into the federal Government Consolidated Fund.
“The federal government will channel the same amount as repaid by the state government as allocation for use for projects to repair dilapidated schools in Sarawak,” he said.
Lim said the repair work of the dilapidated schools in Sarawak should be offered by open tender to ensure transparency and fair value for money based on the current federal government financial arrangements.
“The Federal government is willing to take into account the priority of the Sarawak government in determining the schools to be repaired,” he said.
According to Lim, the four mechanisms had been agreed to by the Sarawak government as stated in the letter from Chief Minister Abang Johari Openg to him dated July 15, 2019.
Lim also explained that as it was deemed to be a repayment of the loan to the federal government, the RM1 billion fund was actually owned by the Federal government, which was agreed to be used to repair dilapidated schools in Sarawak.
If the RM1 billion is repaid, the Sarawak government will still owe the federal government a sum of RM1.352 billion, he said.
Meanwhile, Lim said Abang Johari had agreed to pay back RM350 million to the federal government in the near future.
“After that, several other things will have to be finalised, including the implementation schedule, list of schools and the tender process for the project,” he said, adding that the Finance Ministry was confident that the tender process for the first phase of the dilapidated school repair project would be implemented before the end of this year.