RM93 mill purchase that ended in scrap heap

By Hemananthani Sivanandam

KUALA LUMPUR (Feb 9, 2010): The operator of RapidKL spent RM93 million to buy over 1,294 used buses from two bus companies in 2003, only to have most of them consigned to the scrap heap two years later.

Syarikat Prasarana Negara Bhd bought the buses from DRB-Hicom and Park May Bhd in 2003 but 1,139 of the buses were deemed unfit for operations and were de-commissioned in November 2005.

This was revealed by the Public Accounts Committee (PAC) after its members visited a RapidKL bus ‘graveyard’ in Sungai Buaya, Rawang. The other ‘graveyard’ is in Serendah.

PAC chairman Datuk Seri Azmi Khalid led the group, which included Petaling Jaya Utara MP Tony Pua, Kepong MP Dr Tan Seng Giaw, who is also the PAC deputy chairman and Ledang MP Hamim Samuri. Accompanying them was Prasarana group managing director Datuk Idrose Mohamed.

Azmi told reporters the “official de-commissioning" of the buses was to be in 2008 but the buses were sent to the ‘graveyard’ earlier.

A tender was awarded to TAF Resources to sell the buses as scrap metal.

“Prasarana earlier estimated the scrap value to be RM4.4 million but to date, it has already received about RM6 million from selling the scrap,” said Azmi.

He said the prices of the scrap were based on the weight and the value of the parts that were salvaged.

He said the buses, which were registered from 1992 to 1998 were only evaluated professionally in 2007.

There were only 10 buses which were categorised in category A, which means they were in good condition.

The 2007 evaluation report estimated that on average, each bus was valued at about RM60,000 but it would cost RM200,000 to refurbish and repair it.

As such, it was a choice of repairing the buses at RM200,000 each or selling it off.

When asked if an evaluation was done prior to buying the buses, Azmi said there was but “we don’t know the rationale" for the purchase.

Sources said a simple roadworthy test was conducted to determine the condition of the buses at the time of deciding whether to decommission them.

“The buses were considered working condition if it can be driven for 5km without breaking down,” said sources.

The abandonment of the used buses was stated in the Auditor-General's Report 2008.

Azmi said the committee will review the AG's report against what they have found out, in a meeting tomorrow.

He could not reveal the exact losses suffered by Prasarana and did not confirm if the government-owned company will be called for questioning.

It was reported last year that Prasarana had incurred losses from 2005 to 2007, due to poor management. Accumulated losses as at Dec 31, 2007 was RM839.81 million. -- theSun