KUALA LUMPUR (July 8): The Defence Ministry and Royal Malaysian Navy have been asked to provide regular reports on the long-delayed littoral combat ship project to the Public Accounts Committee.
The quarterly progress reports should include updates on combat system integration tests, the critical phase of the project, to ensure any issues are identified and addressed before further delays, the bipartisan parliamentary committee said in a statement on Wednesday.
The committee also urged the ministry and the Finance Ministry to maintain strict discipline to ensure the project remains within the RM11.22 billion contract ceiling. The Defence Ministry must ensure all five vessels are delivered to the Navy according to the agreed timeline and cost, the PAC stressed.
Initially slated for delivery in 2019, the project has suffered delays and cost overruns from its original RM6 billion amid allegations of mismanagement. No vessels were delivered despite the government disbursing RM6.08 billion. The number of vessels was then reduced to five from six.
The long delays forced the government to step in and acquire the contractor Boustead Naval Shipyard Sdn Bhd for nominal RM1 in 2023. The company was later renamed Lumut Naval Shipyard Sdn Bhd (Lunas) and is now a subsidiary of Ocean Sunshine Bhd, which is owned by the Ministry of Finance.
The delivery of the first vessel, KD Maharaja Lela, originally targeted for August 2026, has since been pushed back to December 2026 due to delays in equipment deliveries from manufacturers and rework involving piping and cabling installations.
The parliamentary committee also called on Lunas to maintain sufficient contingency stock for critical equipment, including radar systems, to prevent further delays caused by supply disruptions or failures among international vendors.
The committee also recommended that the government strengthen mitigation measures and diplomatic efforts to ensure a fair resolution while safeguarding the country’s fiscal position.
It added that the government should fully utilise negotiation channels or legal proceedings to seek appropriate compensation in accordance with the terms of the contract.