By: Nurul Fazliana Norman
KOTA KINABALU: Oct 21, 2026 – The Public Accounts Committee (PAC) will commence a comprehensive investigation into the financial management, governance and physical implementation of the Sabah Pan Borneo Highway (LPB) Phase I project following delays, including a mismatch between expenditure and construction progress.
The PAC chairman, Datuk Mas Ermieyati Samsudin said the decision was made following disclosures in the Auditor-General’s Report Series 2 Year 2026, which was debated in the Dewan Rakyat on 7 October, including issues of weak project management, non-compliance with financial procedures and increased construction costs.
She said that of 35 work packages covering a 706-kilometre stretch, only four packages or 11.4 per cent have been completed. The remaining 31 packages valued at RM16.319 billion are still under implementation even though the project was supposed to be completed by the end of 2021.
“PAC views this matter seriously, especially the issue of fund disbursement and payments made amounting to 94.6 per cent, or RM10.547 billion of the RM11.153 billion allocation received.
“However, when the project is only 11.4 per cent complete and is expected to require more additional funding to be completed, how could this happen?” she said in a statement.
Of the work packages still under implementation, nine are categorised as sick projects, 13 are behind schedule and nine are ahead of schedule.
She said the overall contract cost of the project had also increased from RM17.91 billion to RM18.394 billion. The completion date has been extended to 2030 following weaknesses in planning and implementation.
The audit report also revealed that 57 variation orders worth RM513.99 million were approved without the approval of the relevant authorities as required. Interim payments amounting to RM163.64 million to contractors and consultants were also made without formal contract binding.
She added that government advance funds for utility works amounting to RM41.3 million have yet to be reclaimed from utility companies after the stipulated period. Construction work on 19 packages began before Environmental Impact Assessment (EIA) reports were approved.
Weaknesses in the project information system also led to the loss of 77,299 monitoring data files, raising questions about the effectiveness of monitoring and governance of the project’s implementation.
“PAC views this issue as not merely a matter of ordinary physical construction delays, but rather one involving integrity of governance and government accountability in managing public funds,” she said.
She said the project delay had also affected road users’ access in Sabah to a safer transportation system. It has a cascading effect on the implementation of LPB Sabah Phase II and Phase III, which have yet to commence.
PAC took note of the statement by Deputy Chief Minister Minister of Works and Utilities Sabah, Datuk Seri Panglima Dr Joachim Gunsalam, that several unfinished packages are being actively implemented. Some stretches recorded physical progress of between 90 and 93 per cent.
Eight packages spanning 179 kilometres have also been proposed to be opened in stages before the end of this year.
According to the PAC chairman, the investigation also takes into account issues raised by several Members of Parliament during the debate on the audit report, including the official request by the Kota Belud MP for a comprehensive investigation to be conducted.
“PAC will summon witnesses from the Ministry of Works, the Public Works Department (JKR), including the Sabah JKR, agencies and related parties to provide testimony in the proceedings to be held,” she said.
She stressed that if PAC proceedings uncover any indication of misconduct, corruption or abuse of power, the committee will not hesitate to refer the findings to the Malaysian Anti-Corruption Commission (MACC) and the Royal Malaysia Police (PDRM) for further investigation.
“PAC is committed to conducting its investigation independently, transparently and comprehensively to ensure that every sen of public money spent is managed prudently, responsibly and in compliance with regulations,” she said.
