KUALA LUMPUR (Sept 13): The government should leave the procurement for two of its five littoral combat ships (LCS) to France-based contractor Naval Group to expedite the troubled project, said former deputy defence minister Datuk Seri Ikmal Hisham Abdul Aziz.

He also requested an update on the detailed design of the ships, adding that if this is not at 100% completion, he is not confident that the first LCS by Boustead Naval Shipyard Sdn Bhd (BNS) will be ready by the August 2026 deadline.

Naval Group, which is the technological partner for LCS contractor BNS, can complete the two vessels within three years, Ikmal Hisham told Dewan Rakyat.

BNS is currently working towards completing its first LCS by 2026.

The troubled unit of the Boustead Group is being acquired by the Ministry of Finance to ensure the project’s completion, after years of delay which saw overall costs rise to RM11.2 billion from RM9.13 billion, despite reducing the number of vessels to five, from six initially planned.

“My suggestion is that the second and third LCS should be given to the original contractor, Naval Group, accompanied by terms and options denoting they use any parts already procured by BNS to reduce construction costs,” said Ikmal Hisham, who is also Opposition member of Parliament for Tanah Merah.

“After the second and third LCS are completed by the Naval Group, then the government can consider the need to construct [the] fourth and fifth vessels,” he said during the debate session for the 12th Malaysia Plan Mid-Term Review.

He cited Naval Group’s track record with LCS procurements for the Egyptian and United Arab Emirates’ armed forces.

It should be noted that the suggestion to appoint Naval Group as a rescue contractor for two vessels was one of three options mulled by the previous government to salvage the project.

The other two options, then prime minister Datuk Seri Ismail Sabri Yaakob said in August 2021, were to either complete at least two ships using the RM6.1 billion already allocated; or to terminate the contract with BNS and start a rescue operation of the programme.

Ikmal previously served as deputy defence minister in Ismail Sabri’s administration.

Naval Group provides the Godwind design of the LCS. Prior to the execution of the LCS procurement, the government was reported to have agreed to a separate Sigma design by a Dutch firm, but this was later changed to Naval Group’s Godwind.

Delays to the project have resulted in BNS inking a sixth supplementary contract with the government last May.

Under the original contract, the first of the six vessels had been slated for delivery in April 2019, with BNS initially to deliver a vessel in six-month intervals. The sixth vessel should have been completed by October 2021. 

Pursuant to the revised contract, the fifth — and now last — vessel is to delivered in April 2029.

Meanwhile, Ikmal also suggested that the Ministry of Defence (Mindef) needs to set a threshold or garis merah amaran terakhir (final warning line) to clearly state when the LCS project can be declared a failure.

“Like it or not, want it or not, the LCS project has failed,” he said. This is because at a cost of RM2.2 billion per vessel (under the revised ceiling of RM11.2 billion for five vessels), the ships are the most expensive LCS in the world, he added.

“Perhaps the government’s best move is to listen fairly to the Royal Malaysian Navy’s side with an open mind.

“BNS has repeatedly failed to adhere to the ship delivery schedule despite continuous intervention efforts from Mindef since 2019,” Ikmal said

“What kind of message does the government want to send to domestic and foreign industry players when it continues to allow this incompetence to happen?” he posed.

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