Illogical to stop now, say contractors after MMC-Gamuda contract axed

PETALING JAYA: Contractors have questioned Putrajaya’s decision to terminate the MMC-Gamuda contract for the underground portion of the MRT2 project, saying it does not make sense to cancel it or give it to someone else halfway through.

Daniel Ng, whose company carries out geotechnical work and laboratory testing of raw materials such as concrete and cement, said contractors had invested millions in training workers and buying equipment.

“We are two years into the job and have completed 40% of it. Why stop now?

“If they decide to go for someone else, I don’t see the logic. If something goes wrong, who will be blamed? Will they blame the first guy or the second?” he said to FMT.

Putrajaya terminated MMC-Gamuda’s contract after the two parties failed to reach an agreement over cost reduction and related issues.

The consortium said this would result in “immediate job losses” for over 20,000 people involved in the project from a supply chain of over 600 Malaysian companies.

In a statement, it said over 3,000 of the 20,000 people consisted of MMC-Gamuda joint venture staff, more than 60% of whom are Bumiputeras.

It also claimed the termination would expose MMC-Gamuda to a flood of lawsuits for compensation from employees, sub-contractors, suppliers, manufacturers and others, whose contracts would be similarly ended through no fault of their own.

Ng said he had over 100 engineers who were specially trained by foreign experts to ensure that the quality of materials used meets international requirements.

“I have invested RM1.5 million to RM2 million to buy special equipment to carry out the testing,” he added. “The investment has not yet been fully realised.

“I never thought it would end this way,” he said. “We did work for the Gamuda MRT Line 1 and finished the job in five years.

“We invested more for the next five years for the laboratory testing equipment. We expected it to go on until the end.”

He said he hoped the government would renegotiate the price with MMC-Gamuda.

This follows Prime Minister Dr Mahathir Mohamad’s statement yesterday that Putrajaya would review its decision to open an international tender process for the MRT2 underground work.

Finance Minister Lim Guan Eng meanwhile had said workers could be re-hired by the new contractor if the project continues.

Another contractor, Jimmy Lim, urged the government to view the project in a more positive light.

“They are calling it a termination under convenience clause, which is not right. Imagine if you told your husband or wife that you want to terminate your marriage agreement using this clause. It is not professional,” he said.

“The government needs to re-look the project. Gamuda has completed 40% of the work, with 60% left to go. They (MMC-Gamuda and the contractors) are also prepared to cut down on some of the stations, which means that the cost would drop.”

He also noted that the project tender had been called through an international tendering process. “A fair price was evaluated based on the tendering process,” he told FMT.

He voiced concern over what would happen to the family members of the 20,000 contractors and staff.

Malaysian Employers Federation (MEF) executive director Shamsuddin Bardan meanwhile suggested that the government find alternative jobs for those whose employment was terminated.

“It will be a difficult time for those involved,” he said. “The government should make sure that these staff members are absorbed into the job market.”

He also warned that those who could might look elsewhere for jobs, causing the country to lose valuable talent.

Instead of wooing overseas Malaysians to return under the TalentCorp programme, he said, the government should focus on these people who were facing the axe due to Putrajaya’s decision.