PAN Borneo Highway contractors who have not seen payment since July will be paid within 30 days of the Works Ministry taking over the project’s management for the Sarawak stretch, said Minister Baru Bian.

He told a press conference in Kuching last night that between RM50 million and RM70 million is owed to the contractors, and this is among the reasons for the postponement in works on the 1,077km link.

He acknowledged that according to the deals signed, payment is supposed to be made within 80 days, but most of the 10 work package contractors involved have seen delays of up to three months.

Baru met the contractors during his visit to the Sarawak capital, where they told him about the delay since July.

He said the government’s former project delivery partner (PDP), Lebuhraya Borneo Utara Sdn Bhd (LBU), is responsible for paying the contractors.

The Pakatan Harapan administration has terminated LBU as PDP, informing the company of the matter in a letter dated September 20.

Baru urged LBU to settle the outstanding fees.

“This is the standard (making the payment within 30 days) that I expect of LBU.”

On February 19 next year, the ministry will take over as Pan Borneo Highway project manager.

Baru gave an assurance that once this happens, the contractors will be paid within 30 days for works completed.

A ministry committee will be formed to oversee the project, and the Sarawak Public Works Department will manage it, he said.

He added that another factor for the delay in construction is the slow removal and relocation of utilities.

LBU had awarded the job to KURW, a unit of OBYU Group, said the minister.

OBYU is linked to businessman Bustari Yusof, an associate of former prime minister Najib Razak. It is also one of the entities named by the Malaysian Anti-Corruption Commission in forfeiture suits to recover assets and cash linked to 1Malaysia Development Bhd. – November 7, 2019.