MRT, cost going up before construction ....

We know that the cost of the MRT was estimated at RM 36 billion. Before 2 weeks of the announcement had ended, there was mention that the cost was estimated at RM 36.6 billion. How nice ! Within 2 weeks, the cost had gone up by RM 600 million. And now, there was mention that it would cost RM 50 billion, less than a couple of months since the announcement. The increase was estimated based on some professor in a far-off land who said that rail-based projects had a tendency to ultimately cost some 30% to 60% more of the original estimate or the contract price.

The Rakyat are being gradually fed with this information on cost escalation, even though the project has not yet started, so that when the cost ultimately reached say a RM 100 billion, it is hoped by the people concerned that the Rakyat would not be shocked ! The Rakyat would eventually be told that the cost is only a slight increase from the last estimate in a chain of escalated costs that would be spun from the news media.

Ever hear of the cost to build the Agong's Palace. It started with some RM 400 million, then it went up to RM 485 million, then to some RM 800 million, and before the Rakyat could figure out what went on, the last figure that was in the news is that it now cost some RM 1,200 million. What kind of engineers, quantity surveyors, estimaters, valuers, economists, in the JKR that did not seem to know how to make a reasonable estimate on the cost of a building and the relevant infra-structures. It is as though these people start with a price and then simply allow it to escalate, regardless. It is not in their interest to come out with a price and work around it. In contrast, people in the private sectors would squirm in their shoes if the price is 10 % above the budgetted or contract price, as this would imply that they are corrupted or worse, that they are simply inefficient. Apparently, those in the JKR feel that cost overruns, in what ever order of magnitude, seem to be part and parcel of how they manage projects.

Ever hear of the Shah Alam General Hospital. The RM 482 million contract was awarded to a company run by 3 Selangor royal monkeys who between them had never done any construction jobs in their lives. Lately, we hear that JKR had terminated the contract and intended to recall tenders for whatever was left of the contract. To be fair to the present JKR team, the contract was given by JKR when the Works Minister then was Samy Velu. We'll see whether the current Minister is tough enough to handle the situation or back to be subservient to those 3 royal monkeys.