Lim Guan Eng cites fresh LCS delays in renewing scrutiny of Zahid’s ‘please implement’ note

KUALA LUMPUR, Oct 6 — DAP’s Lim Guan Eng today cited fresh delays to Malaysia’s Littoral Combat Ship (LCS) project in renewing scrutiny of Deputy Prime Minister Datuk Seri Ahmad Zahid Hamidi’s role in the procurement when he was defence minister.

In a statement, the Bagan MP referred to the latest findings in the 2026 Auditor-General’s Report, which found that the RM11.22 billion project was 7.55 per cent behind schedule as of June 25.

Lim also referred to a July 8, 2010 letter from Boustead Naval Shipyard (BNS) to Ahmad Zahid, then defence minister, seeking a letter of intent from the government for the LCS project.

A handwritten note attributed to Ahmad Zahid on the letter read: “SUB [Division Secretary] Procurement, please implement.”

“The words ‘please implement’ continue to haunt Ahmad Zahid Hamidi over the RM11.22 billion purchase of five LCS,” Lim said.

The letter was among documents contained in a report by the Special Investigation Committee on Governance, Procurement and Finance that was declassified in 2022.

According to the latest Auditor-General’s Report, progress on the LCS project was 7.55 per cent behind schedule as of June 25, with delays ranging from 30 to 108 days.

The report said the delay could affect the physical handover of LCS 1, which had initially been scheduled for August 26 and now has a revised target date of December 26.

It also said the ship could be handed over without full operational capability because training and weapons systems had yet to be completed.

Full operational readiness for the programme depends on a supplementary contract that is expected to be completed in December 2035, beyond the April 25, 2030 expiry of the main contract.

The Auditor-General also said delays to LCS 1 could affect the delivery schedule for the remaining four vessels.

Lim said the longer timeline raised questions over whether some of the technology used in the ships could become outdated before the programme achieved full operational readiness.

“Apart from the loss of billions of ringgit, a 24-year delay in the delivery of the LCS by 2035 for an order placed in 2011 would inevitably raise questions over whether the technology used in the ships would have become obsolete and outdated,” he said.

Lim’s calculation of 24 years spans the period from the project’s procurement in 2011 to the 2035 target for full operational readiness, rather than representing a 24-year delay against the original ship-delivery schedule.

The LCS programme was originally for six vessels under a RM9.128 billion contract, with the first ship due in 2019 and the remaining vessels to be delivered by 2023.

The project was later restructured, reducing the order to five ships while increasing the contract value to about RM11.22 billion.

The project drew widespread attention in 2022 after the Public Accounts Committee disclosed that RM6.083 billion had been paid as of October 2020 despite none of the six ships having been delivered.

BNS was subsequently renamed Lumut Naval Shipyard Sdn Bhd, or Lunas, with the government stepping in through a Ministry of Finance-owned vehicle as part of efforts to complete the project.

By the end of 2025, expenditure on the project had risen to about RM8.3 billion, while construction of the first vessel had moved into shipyard-level sea trials.