PM: Cabinet greenlights declassification of LCS report, AG to prosecute those responsible should evidence suffice

KUALA LUMPUR, Aug 10 — Prime Minister Datuk Seri Ismail Sabri Yaakob said that the Cabinet had today proposed to have the 2019 Littoral Combat Ship (LCS) forensic auditing report be declassified following furore among Opposition lawmakers over alleged financial irregularities surrounding the mega military project.

In a statement, Ismail Sabri, however, said that the matter first requires the advice and insight of the attorney general and auditor-general.

He said that the Cabinet also urged the Malaysian Anti-Corruption Commission (MACC) to hasten investigations into the issue and should strong evidence surface, the AG must prosecute those responsible.

“The government views the current Littoral Combat Ship (LCS) issue, which is under investigation by the Malaysian Anti-Corruption Commission (MACC), seriously. This matter was discussed in detail in the Cabinet meeting today.

“I called the Attorney General Tan Sri Idrus Harun, and MACC chief commissioner Tan Sri Azam Baki, after the Cabinet meeting, to immediately act in accordance with the decision of the meeting.

“At the same time, the Cabinet decided that the Public Governance, Procurement and Government Finance Investigation Committee (JKSTUPKK) chaired by former auditor-general, Tan Sri Ambrin Buang, is allowed to be broadcast to the public,” Ismail Sabri added.

He said that the decision of the Cabinet today will not interfere with the mobilisation process under the LCS Recovery Plan decided by the Cabinet on April 20, 2022, and that the government is committed to continuing the project in the interests of the country’s defence, in line with the requirements of the Royal Malaysian Navy (RMN).

“I, on behalf of the government, assure that the investigation on this issue is conducted transparently and the government will not protect anyone involved,” he added.

On Monday, former defence minister Mohamad Sabu and his former deputy Liew Chin Tong demanded the declassification of three documents as part of the solution for the multi-billion-ringgit LCS scandal.

The documents that the pair called to be declassified in a joint statement are: the Tan Sri Ambrin Buang committee report titled “Special Investigation Committee on Public Governance, Procurement and Government Finance (JKSTUPKK) Report in Connection with the Procurement of Six Second Generation Patrol Vessels (SGPV), LCS Capacity, Royal Malaysian Navy (RMN), Malaysian Ministry of Defence (Mindef)”; Boustead Naval Shipyard Sdn Bhd’s forensic report on the LCS commissioned in 2019; and the 10 letters written by the former Commander of the RMN Tan Sri Abdul Aziz Jaafar.

The first report contains detailed financial information that is not fully disclosed in the report by the Parliamentary Public Accounts Committee (PAC), they said.

The BNS forensic report, which was conducted by audit firm Alliance IFA, was deemed crucial as it contains details of “exactly who was culpable at the operational alliance”.

The same day, Defence Minister Datuk Seri Hishammuddin Hussein told the Dewan Negara that the first of six LCS purchased from Boustead Naval Shipyard Sdn Bhd (BNS) should be ready no later than two years from now.

Last week, he revealed that the MACC was investigating the matter.

The LCS project is the largest procurement in the history of Mindef with a total cost of RM9 billion.

The matter was brought to public attention after the PAC report said the RM9.128 billion, 10-year contract from October 2013 to October 2023 was awarded through direct negotiation to contractor BNS for the supply of the six LCS.

The report also said the Malaysian government had to date already paid RM6.083 billion to the contractor, but none of the six LCS vessels have been completed. Based on the original schedule, five of the six LCS vessels should have been completed and handed over by August 2022.

According to the PAC, the project had run into cost overruns of RM1.4005 billion as the government’s payments to the Boustead Naval Shipyard was not fully used for the LCS project, noting that the RM1.4 billion overrun included RM400 million that was spent to pay off an old debt for the New Generation Patrol Vehicle project.

The PAC report said equipment kept in storage for the LCS project is estimated to be worth RM1.7 billion, with an estimated 15 per cent of these already obsolete.