In a written reply to Lim Lip Eng (DAP-Segambut) in Parliament today, Works Minister Datuk Shaziman Abu Mansor explained that the additional allocation was to bear costs that were not included in the original contract which was set at RM650 million.
They include costs to increase the palace’s security system, capital contribution payments to utility companies and interior decorations.
“The contract cost for the construction of the Istana Negara complex on Jalan Duta on a 100,000 square feet area was set at RM650 million.
“However, this cost did not include several other components of the project, which should be taken into consideration for the full completion of the palace,” he said.
With the RM147 million injection, added Shaziman, the total cost of the palace would balloon from RM650 million to RM797 million.
However, this does not include the construction costs for access roads into the new palace.
Shaziman said that that original estimate of the RM130 million flyover to the complex from Jalan Duta had now dropped to RM106 million while upgrading works on Jalan Changkat Semantan remained at RM32.5 million.
As such, the total cost for the construction of the palace complex and the access roads would rake up the bill for the new palace to a whopping RM935.5 million.
In 2006, former Works minister Datuk Seri S. Samy Vellu had said that the new palace would only cost RM400 million.
Shaziman said today however that the operational and management costing for the entire project would only be completed by next June 30.
The controversial Istana Negara project has been continuously used as a bone of contention between lawmakers across the political divide.
Recently, Opposition Leader Datuk Seri Anwar Ibrahim charged that an unlicensed “dormant” company was appointed as contractors for the complex.
He claimed that the Maya Maju (M) Sdn bhd construction firm had won the contract from the Works Ministry despite being unlisted and not registered under the Construction Industry Development Board (CIDB).
A check with the Companies Commission of Malaysia had revealed that the company was defined as “dormant” as it did not conduct any businesses, had no prior track record or experience in the construction business, he had said.
Maya Maju, he added, was only registered as a construction company on August 2008, long after it obtained the contract to build the palace in October 2007.
He also claimed that the company was owned by the former treasurer of Umno Merbok.
