MTUC on half-a-billion ringgit Socso centre: Why Ipoh and why with workers’ money?

MTUC on half-a-billion ringgit Socso centre: Why Ipoh and why with workers’ money?
FMT Reporters
-October 21, 2019 10:13 AM

MTUC says the choice of Ipoh – which is in the constituency of Human Resources Minister M Kula Segaran – for the construction of a new Socso treatment centre is puzzling.

PETALING JAYA: The Malaysian Trades Union Congress (MTUC) has warned Putrajaya against using funds from the government’s workers insurance scheme Socso to build a half-a-billion ringgit treatment centre, while questioning the human resources minister over the choice of his own parliamentary constituency for the mammoth project.

The union also accused the ministry of ignoring the consultation process in coming up with the plan, saying the matter should have been brought up with the National Labour Advisory Council.

It said using funds from Socso meant that a large chunk of hard-earned money contributed by workers would be depleted for a construction project that had risks of cost overruns.

“Going by past experiences, the projected cost will rise by about 20 to 30% by the time it is completed,” said MTUC secretary-general J Solomon

He cited a similar rehabilitation centre in Melaka which saw a cost overrun of RM75 million by the time it was completed in 2014.

“As such, MTUC is strongly against Socso funds or, to be more precise, workers’ contributions, being used to build and operate massive undertakings that drain Socso’s financial strength,” said Solomon, who estimated that the new centre would cost Socso RM150 million in annual maintenance.

“The cost of running the two centres can easily add up to RM300 million or more. This will bleed Socso and the organisation may no longer be sustainable in the long run.

“It could well force the federal government to step in with a bailout,” he said.

He added that funds for such a large project should come from Putrajaya “and not from the savings of low-salaried workers”.

Finance Minister Lim Guan Eng announced in his recent budget speech the construction of the Socso Rehabilitation Centre in Ipoh at a cost of RM500 million, touted as the largest such facility in Southeast Asia.

“The new centre will be equipped with the latest technology including robotics, trauma treatment and a centre of excellence for prevention of accidents, in collaboration with relevant agencies,” Lim had said.

Solomon said while the centre is needed, questions remain about funding, location and the transparency of the Ipoh project.

“It appears that this is similar to what was done by BN’s Dr S Subramaniam when he was the human resources minister. The centre was built near his hometown.

“Now, a massive RM500 million rehabilitation centre is to be built in the home state of M Kula Segaran. We are wondering if this is a mere coincidence or are we providing continuity to the bad practices of BN?” he added.

Kula is the MP for Ipoh Barat.

MTUC said the government should have considered building such a centre in the east coast or East Malaysia, adding that state governments there would likely help by providing land.