DAP wants government to explain RM8b armoured vehicle buy

The DAP’s economic strategist, Tony Pua (picture), said the Defence Ministry should explain why the government was willing to spend a whopping RM8 billion to acquire 257 armoured-wheeled vehicles.

The Petaling Jaya Utara MP questioned why each vehicle was priced at a “ridiculous” RM31.1 million.

“The transaction first defies belief due to the price the Ministry of Defence will be paying to DRM Hicom's wholly-owned subsidiary Defence Technologies Sdn Bhd (Deftech).

“The latest version of the Piranha III 8x8 armoured vehicles costs 364 million euros (RM1.6 billion) or an average of 1.03 million euros or only RM4.41 million each.

“In 2009, the US army awarded a US$2.2 billion contract to General Dynamics Land Systems-Canada, one of the best military vehicle and equipment manufacturers in the world, for 724 light-armoured vehicles (LAV) or the equivalent of US$3.04 million or only RM9.9 million each, meant for Saudi Arabia,” he told reporters during a press conference in Parliament today.

He said Deftech had admitted that the company was only at the stage of developing a prototype.

Pua also asked why the ministry was able to spend RM8 billion when the Finance Ministry has issued a circular to reduce government expenditure.

“The Ministry of Finance has issued strict Treasury circulars for all ministries to reduce their operational expenditure by as much as 20 per cent which has resulted in no food on weekends in boarding schools, restricted the use of classrooms due to the need to conserve electricity, but the Defence Ministry commits to a purchase that completely mocks the attempt by the government to be thrifty.

“What is worse, it makes a complete mockery of the government’s excuse to implement new tax schemes such as the Goods and Services Tax (GST) which will only raise RM1.3 billion when the government splurges an astronomical RM8 billion just to purchase armoured-wheeled vehicles,” he said.

Pua stressed that the government must review and cancel the RM8 billion contract.

“What we see here is continuing abuse and mismanagement by the Ministry of Defence which has been plagued by repeated scandals and failures over the past years such as the RM6.75 billion purchase of naval patrol boats from crony company PSC-Naval Dockyard, the RM3.4 billion purchase of two submarines with a RM500 million commission and, more recently, a laughable RM2.7 million purchase of ladies leather shoes for female civil servants,” he said.