AUDIT REPORT Delays by a contractor in installing a network of sewerage pipes in Kuala Sawah, Seremban, have caught the eye of the auditor-general for three reasons.

The cost went up from RM81.45 million to RM121.65 million; the project had to be deemed a ‘sick’ one as the work was incomplete; and the Sewerage Services Department did not file a claim for losses.

The project has since been handed to a different contractor who is proceeding with the work, according to the Auditor-General’s Report 2012.

The department has explained to the auditors that it had monitored the project and assisted the original contractor, but to no avail. Eventually, the contractor’s services were terminated.

The department has, however, undertaken to recover the losses incurred as well as due compensation from the contractor, and was to have filed the claim in July this year.

It also said the contractor was not pre-qualified based on specifications of the tender evaluation committee at the Green Technology, Environment and Water Ministry.

The auditor-general has recommended blacklisting the contractor, Satriadesa Corporation Sdn Bhd.

The reports states that choosing the right contractor must be based on technical and financial capability, so that the government does not incur losses and projects are not abandoned.

The department also had to answer for other delayed projects - only 35 of the 62 contracts awarded were delivered on time.

On a positive note, the report notes that the department has taken a positive step by collecting Liquidated Ascertained Damages worth RM6.63 million from six contractors who had failed to meet deadlines despite getting an extension of time.