I guess the following letter that was sent to MB this morning would give you an indication on the overall project matters. Things dont look very rosy from our end but we are not giving up. We are also in touch with Prokhas.
1 February 2010
Rujukan kami: PHUKB/DB/15
Y.A.B. Tan Sri Dato` Abd Khalid Bin Ibrahim
Dato` Menteri Besar Selangor
Pejabat Menteri Besar Selangor
Tingkat 21, Bangunan Sultan Salahuddin Abdul Aziz Shah,
40503 Shah Alam
Yang Berbahagia Dato` Menteri Besar Selangor
MASALAH PROJEK UKAY BISTARI DIBAWAH PEMAJU DAMAI BISTARI (PROJEK PERUMAHAN SAKIT) YANG DI JADIKAN TENAT OLEH RSS CONSULTANT SDN BHD
1. The above matter is referred.
2. As YAB is fully aware, the Selangor State Government has appointed RSS Consultant Sdn Bhd via “Abandon Housing Project Task Force Negeri Selangor” (Task Force) to study and find ways to assist purchasers in completing the above project.
3. The purchasers association, PHUKB would like to EXPRESS OUR SERIOUS DISPLEASURE over the current state of affairs related to the project which in our opinion is due to the weaknesses of State Government in general and the RSS Consultant Sdn Bhd (RSS) in particular. Allow us to explain the basis of our displeasure.
4. For the record, the various contractors appointed by RSS (via the developer, Damai Bistari or DBSB) have spent more than RM10 million to-date in doing construction works at site. They have not been compensated ADEQUATELY and FAIRLY. Currently, all the appointed Contractors are facing serious cash flow problem. The project has paused several times in the last few weeks and appears that it will stall again in the very near future. We are in the current state of affairs because:
a. The Task Force operates in a grey zone between the State Government and private entities without committing state resources directly despite it has the capacity to do so.
b. These led to RSS operating by seeking project management fees from the appointed Contractors as well as from DBSB. The contractors informed us that they have to pay RSS upfront in order to be awarded the contracts.
c. The Task Force does not monitor activities of RSS in a structured manner leading to RSS operating at its own whims and fancies in reviving the project. The Task Force rely solely on what is reported by RSS without any independent verification. Officially, the Task Force has never sought PHUKB feedback despite our close monitoring of the project.
d. RSS is undertaking questionable and unethical practices with the contractors. Among others these include:
i. Coaxing Contractors to commence works by using letter heads representing the Task Force without proper contract first in placed between DBSB and the Contractors. This gave the false impression that the project is being monitored by the state and thus Contractors are assured of payments.
ii. Making promises to various parties which cannot be fulfilled by DBSB.
iii. RSS in it’s dealings with PHUKB, the Ministry of Housing and many other parties change roles repeatedly where at times it claims that it represents the State (via the Task Force) and sometimes acting on behalf of DBSB and also Tan Sri Chan Ah Chye of Talam. On other occasions it represents the Contractors. There is no transparency and accountability in the way it operate.
iv. Create animosity and antagonistic relationship between the various parties and thus through management in chaos makes RSS indispensable.
5. As a result of the above, Contractors are now in a limbo. They have already spent collectively more than RM10 million. Payments are overdue between 45 days to 9 months. The purchasers are being lumbered into paying more monies without any firm completion deadline on the card. The recovery programme has been revised three times. Works have practically stalled and currently the Contractors are doing insignificant works.
6. At the meeting organized by Ministry of Housing on the 28th Jan 2009, the Ministry officials and PHUKB agreed and reiterated that DBSB need to raise the necessary funds to improve cash flow position to pay the Contractors.
7. RSS did not see this as a solution and instead was working in concert with DBSB. They are taking steps to determine some the contracts with existing contractors.
8. RSS seems to be washing it’s hands now and saying it is not a party to the contracts. Paper trail will show that RSS was involved in bringing in the Contractors, soliciting payments and working out the contract details between the Contractors and DBSB.
9. RSS is now wanting to bring in new Contractors to do the unfinished works. Without solving the cash flow issue, bringing in new Contractors will make things worse as more debts will be created.
10. Today we discovered another shocking news in that a new Contractor was brought into the project to work on Block F of the Service Apartment. We spoke with the Contractor, Jitrabumi Corporation (M) Sdn Bhd (En Mohd Fauzi Ramlee 0192723800) where he confirmed that he has yet to receive the letter of award from DBSB. RSS had instructed the Contractor to move in and start preliminary works.
11. RSS promised the Contractor that the letter of award is in process and will be issued out soon. Inquiry with DBSB showed that they do not have records of any new contractor being awarded contract for Block F.
12. The same modus operandi has being used in the last 10 months or so with all the contractors. From our observation, a deep hole is being created as more contractors are sucked into this project. It is fast becoming a scam.
13. As stakeholders, PHUKB do not take what we see kindly. PHUKB, an organization that represents 2,000 purchasers (or 4,000 voters) is very concern on the political impact on this matter. This reflect poorly on the State leadership and the government . PHUKB see a clear solution to this matter.
a. The State must take stock and manage the situation by managing the bull by its horn. It has to take stern actions to manage RSS despite the political networks involved.
b. Setup a legal based platform involving the State (or its appointed GLC) and to work with DBSB and PHUKB on a mutually agreed platform.
c. We believe a short term LOAN from the State government (or its GLC) is very useful in improving cash flow and project progress.
14. We seek YAB IMMEDIATE INTERVENTION in this matter for the sake of the rakyat . Thank you.
`KAMI BERKHIDMAT SECARA SUKARELA DAN BUKAN SAMBIL LEWA`
Dr Mohamed Rafick Khan bin Abdul Rahman
(1) Exco Perumahan & Timbalan Exco
Pejabat SUK Negeri Selangor
Bangunan Sultan Salahuddin Abdul Aziz Shah,
40503 Shah Alam
(2) Pengarah Eksekutif
Lembaga Perumahan & Hartanah Selangor
Tingkat 5, Podium Utara
40503 SHAH ALAM
Selangor Darul Ehsan
RSS Consultant Sdn Bhd
1275,Jalan Tanjung 5/4
46000 Petaling Jaya
(Shariffudin bin Budin)