Najib: Guan Eng abusing power on PDC contracts

KUCHING – Prime Minister Najib Razak has accused Penang Chief Minister Lim Guan Eng of abusing his powers by terminating contracts awarded by the Penang Development Corporation (PDC) without giving any reasons.

Elaborating, he said that contracts could not be terminated unless there have been violations of the terms awarded by the PDC because it was an agreement between the government and the relevant party, including the contractor.

"I do not see the basis for termination of the contract and so on," he was reported as saying by Bernama.

Can seek compensation

The prime minister was asked to comment on the inclusion of a clause in the PDC Tender Form A stating that contractors could have their contracts terminated at any time without any reason given upon the order of the chief minister or PDC chairman.

Lim is also PDC chairman.

Najib said that if Lim terminated any contract arbitrarily, such action could be regarded as abuse of power.

The company which had its contract terminated would not only suffer losses but would have the right to demand compensation from the state government, he said.