Parliamentary committee investigates delays in the Sabah Pan Borneo Highway project

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Parliament investigates Sabah Pan Borneo

Highlights

The PAC will investigate delays in the Sabah Pan Borneo Highway project after the Auditor General's Report found that only 4 of 35 packages were completed despite more than RM10 billion being spent from the RM11.15 billion allocation as of 31 March 2026.
The completion timeframe for the Sabah Pan Borneo project has now been extended to 2030, with contract costs rising to RM18.394 billion from RM17.91 billion, compared with the Sarawak section, which has been completed.
The Auditor General's Report revealed that 57 variation orders worth RM513.99 million were approved without proper authorisation and interim payments of RM163.64 million were made without formal contracts, causing Phase 1A cost projections to exceed the original ceiling by RM987 million.

This article was translated from the original. Read the original version by our correspondent here.

PAC investigation and project implementation issues

The Edge Malaysia reported that the Public Accounts Committee, or PAC, will investigate the long-delayed Sabah section of the Pan Borneo Highway project following findings in the latest Auditor General's Report. Its chairperson, Datuk Mas Ermieyati Samsudin, said the issues extend beyond ordinary construction delays, as they raise questions about governance and accountability in the management of public funds.

She said the delays have deprived road users in Sabah of safer connectivity and better access. They have also had a knock-on effect on the next two phases, which cannot begin until the first phase is completed.

The 706-kilometre project linking Sabah, Sarawak and Brunei officially began construction in 2016 and was originally scheduled for completion within 69 months. However, only four of the 35 work packages had been completed, despite more than RM10 billion having been spent out of the government's total allocation of RM11.15 billion as of 31 March 2026.

Mas Ermieyati said the PAC will summon witnesses from the Ministry of Works, the Public Works Department, as well as relevant agencies and parties to testify in its proceedings. The committee will also examine how the shortcomings could have occurred despite various monitoring committees being established at the state and federal levels, including whether existing oversight mechanisms were sufficient to approve payments that did not correspond with physical progress on site.

If the proceedings uncover indications of misconduct, corruption or abuse of power, the PAC said the findings will be referred to the Malaysian Anti-Corruption Commission and the Royal Malaysia Police for further investigation.

Cost, schedule and regional development implications

The Sarawak section of the project has been completed despite commencing around the same time as the Sabah project, highlighting the implementation gap between the two states. The completion timeframe for the Sabah section has now been extended to 2030, while the project's total contract cost has risen to RM18.394 billion from RM17.91 billion.

The Auditor General's Report released earlier this month also found that 57 variation orders worth RM513.99 million were approved beyond the authorised limit without the required approval. In addition, interim payments totalling RM163.64 million were made to contractors and consultants without formal contracts.

Meanwhile, cost projections for 15 work packages under Phase 1A increased by RM987 million to RM11.323 billion. This exceeds the original cost ceiling of RM10.336 billion, adding pressure to fiscal management and the effectiveness of oversight for major infrastructure projects in Sabah.

In our earlier report on the impact of the 1MDB scandal on the corporate governance debate in Malaysia, we examined how failures in controls, audits and checks and balances prompted calls to strengthen board accountability. The article also addressed stronger whistleblower protection and calls for internal auditors to take a more proactive role in identifying risks earlier, rather than merely assessing past failures.

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