PAC probes RM10.5b spending on Sabah Pan Borneo Highway
KUALA LUMPUR: The Public Accounts Committee (PAC) will investigate the Sabah Pan Borneo Highway Phase 1 project following concerns over RM10.547 billion in expenditure, despite only four of its 35 work packages having been completed.
PAC chairman Datuk Mas Ermieyati Samsudin said the investigation would scrutinise the project’s financial management, governance and physical implementation, particularly the effectiveness of monitoring mechanisms in overseeing public expenditure.
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She said the committee would examine how substantial payments had been approved despite construction delays and serious implementation problems affecting several work packages.
“What PAC is questioning is the justification for the existing monitoring system that approved project payments when physical progress on the ground does not correspond with the amount of public money spent,” she told a press conference at Parliament today.
Mas Ermieyati said the Auditor-General’s Report 2/2026 revealed that RM10.547 billion, or 94.6% of the RM11.153 billion disbursed between 2016 and March 31 this year, had been spent.
However, only four work packages, representing 11.4% of the 35 packages, had been completed, while the remaining 31 packages, worth RM16.319 billion, were still under implementation.
Of the 31 outstanding packages, nine were classified as troubled projects, 13 were behind schedule and nine were ahead of schedule.
The 706km highway project, which was initially scheduled for completion by the end of 2021, has since been extended to 2030. Its total contract cost has also increased from RM17.910 billion to RM18.394 billion.
“Almost the entire allocation disbursed for the project has been spent, yet only four of the 35 work packages have been completed, and additional funding is expected to be needed.
“How could this have happened?” she said.
Mas Ermieyati also highlighted audit findings involving 57 variation orders worth RM513.99 million that exceeded permitted approval limits without the necessary authorisation.
Other findings included RM163.64 million in interim payments to contractors and consultants without formal contractual arrangements, as well as RM41.37 million in advance payments for utility works that had not been recovered within the stipulated period.
Construction work on 19 packages had also begun before environmental impact assessment approvals were obtained. Meanwhile, weaknesses in the project information system had resulted in the loss of 77,299 monitoring data files.
“PAC does not view this as merely an ordinary delay in physical construction. It involves the integrity of governance and the government’s accountability in managing public money,” she said.
Mas Ermieyati said PAC would summon representatives from the Works Ministry, the Public Works Department (JKR), JKR Sabah and other relevant agencies to give evidence.
She warned that any indications of misconduct, corruption or abuse of power uncovered during the proceedings could be referred to the Malaysian Anti-Corruption Commission (MACC) and the police for further investigation.
“PAC will not hesitate to refer its findings to MACC and the police if the proceedings uncover any indications of wrongdoing, corruption or abuse of power,” she said.
She added that delays in Phase 1 had also affected plans to begin subsequent phases of the highway project, prolonging difficulties faced by road users in Sabah.
However, PAC acknowledged an update from Sabah Deputy Chief Minister I Datuk Seri Panglima Dr Joachim Gunsalam that some incomplete stretches had achieved between 90% and 93% physical progress.
Eight work packages covering 179km have been proposed for phased opening before the end of this year.