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Tuesday, November 25, 2014

PAC lambasts MAHB for ignoring stakeholder AirAsia's concerns when building klia2


KUALA LUMPUR (Nov 25): The Public Accounts Committee (PAC) today slammed Malaysian Airports Holdings Berhad (MAHB) for ignoring the needs of stakeholders such as AirAsia Bhd when constructing klia2.

As a major stakeholder who contributes almost 80% of the traffic forecast for klia2, many of AirAsia's concerns were not taken properly into account when the new airport was built, PAC chairman Datuk Nur Jaslan Mohamed told reporters at Parliament lobby.

"People may be angry with me when I say this (but) Airasia (is) driving the low-cost flight industry and the growth of klia2. It is not Malaysian Airlines [System Bhd] (MAS)," he said.

"MAS is in Intensive Care Unit (ICU) now. From ICU they may move to Coronary Care Unit (CCU) then normal ward but that will take years. Its companies like AirAsia and Malindo Air that are driving the growth of KLIA2," he added.

He was commenting on the PAC's report on the construction of klia2, which was tabled in Parliament earlier.

There are 41 pages in the report, excluding the excerpts taken from the Hansards of five meetings held with parties involved in the project, such as AirAsia co-founder and group chief executive officer (CEO) Tan Sri Tony Fernandes, MAS managing director Tan Sri Bashir Ahmad Abdul Majid, MAS chief operating officer Datuk Abdul Hamid Mohd Ali, and the Ministry of Transport's secretary-general Datuk Seri Long See Wool.

The report looked at 10 areas and summarised how and why the cost of building the airport had ballooned from RM1.7 billion in 2007 to about RM4 billion to date. The status of klia2 - which was initially meant to be a low-cost carrying terminal - has also morphed into one of a hybrid airport.

Among the points highlighted by the report were that with the change in status to a hybrid airport, klia2 now threatens Kuala Lumpur International Airport (KLIA)'s status as the main airport in the country.

It also represents a "missed opportunity to develop a cheap flight hub which is competitive in the Asia Pacific region", it stated.

The report stated that this was the first time that MAHB was given a contract to build its own airport. However, rather than building an LCCT as demanded by the stakeholders it "obviously was not concerned" with the demands of their concern, the report noted.

It also noted that MAHB had made "unrealistic promises" to the government with regards to the expected opening period of klia2. MAHB, said the PAC report, was "too optimistic" when it set September 2011 as deadline for the project to be completed. The airport eventually opened on May 2 this year.

On the problematic soil condition at the new site, PAC noted that MAHB built klia2 against previous recommendations of other sites, which ended up costing the company RM860 million on earthworks and reclamation alone. These works were initially estimated to cost RM 35 million.

MAHB's decision to build the new airport on the west also resulted in it having to build an additional runway, costing RM270 million, as well as a separate control tower, costing RM55 million.

PAC noted that as the cost shot up and allocation was insufficient, MAHB decided to use vertical drains and surcharge reclamation for soil consolidation, but did not follow the ideal period of 3-5 years. Deposition continued, which caused the delay in building the terminal, apron, the runaway and the taxiway.

It noted that deposition of the apron and taxiway has continued until today, resulting in water stagnation when it rains. To date, there are 10 sites where depositions have been identified.

The report also recommended that the Auditor-General audit the construction of klia2 and identify the parties responsible for the main problems that were found in the project.

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