Sunday, April 04, 2010

Royal hospital Project

Why was the contract of the Shah Alam Hospital given to a sister of the Sel;angor Sultan? The $482 million contract was given to her company, Sunshine Fleet under the guise of a negotiated tender.

In other words it was a contract with a bloated price. Had there been an open tender the price would have been half of what it was given.
If that is not rent seeking than can somebody please tell me what it is?

Most likely some UMNO boys will also benefit from the project by been given the sub-contract and who after taking a cut would have again sub-contracted it to a chinaman company who would than do the work. But in most cases by the time the project reaches the chinaman , most of the profit would have been skimmed off and if the project is no longer profitable most likely it will be abandoned.

And to rescue the project, the govt will have to call for another tender or another round of negotiated tender and the whole vicious cycle of bleeding the nation's coffers is repeated.

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