(The Star) - The Federal Government is paying RM80mil annually to Spanco Sdn Bhd to have the latter maintain its fleet of 1,400 Proton Perdana V6 Executives and other vehicles designated for official use.

This works out to about RM12,000 annually to maintain each of the locally-made luxury-line Proton Perdana leased from Spanco.

On Friday, Terengganu Mentri Besar Datuk Ahmad Said called on the ACA to probe the high service charges imposed by Spanco.

The Perdanas were part of a fleet of 5,600 vehicles of various models and makes that Spanco, a vehicle fleet management company contracted to lease and maintain vehicles for ministers, top civil servants and senior government officials, made available to the Government.

The contract was inked in 1994 for the duration of 25 years as part of the Government’s privatisation exercise. It expires in 2019.

In that contract, the Government paid Spanco RM100mil a year to lease and maintain its entire fleet.

But in June 2003, Spanco and the Government returned to the negotiating table when the Finance Ministry found the contract awarded to Spanco in 1994 excessive. The Government appointed an international audit firm to look into Spanco’s books.

Under the revised agreement, the audit firm recommended the Government cut back the contract by 20% to RM80mil annually. Spanco chief executive officer Datuk Hamzah Mohd Salleh said the issue of cost overrun and high maintenance charges did not arise at all under the Government-Spanco deal.

“Any overrun would be borne by us,” he said, but declined to reveal the details of the package.

“We only leased the vehicles to the Federal Government. We don’t do the state governments’ business.”

A source told The Star that the Government was Spanco’s only customer.

Under the deal, the Government gets new Proton Perdanas every fourth year.

Comments (23)

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written by justice, July 27, 2008 11:03:17

For the quality of work done by BN politicians, they only deserve to use the following as their official vehicle (maintenance costs < RM100/unit/year):

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written by krising1, July 27, 2008 11:38:57

100 million from 1994 to 2003. Since then it has been 80 million. Total of almost 1.5 billion. How Merc could we have bought this money?

Obviously the company belongs to an UMNOputra. What was our Account-General doing? Picking on 50 ringgit screw deals and missing the millions.

How come these things do not appear in any report? Is this what they mean by transparency?

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written by yipck, July 27, 2008 11:48:21

Wah !! average of RM14k per vehicle!!!! so expensive to maintain??? Got to be joking!!

New car has warranty of at least 2 years!! So Spanco Sdn Bhd earns free money for those new car for at least 2 years!!!!

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written by yipck, July 27, 2008 11:55:31

eh..if you send back to proton for service of perdana at RM1k per month!! its only 12k!! (perdana servicing where got such expensive?). If got in accident, it is cover by insurance. No need to come out with a single $$$..
So again, Spanco sdn bhd is making hugh money. All u need is to hire few guys for RM1000 monthly each just to drive the car to Proton and wait there!!

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written by ctchoolaw, July 27, 2008 12:03:25

The old shit has resurfaced again. Spanco has been there for ages ... so, who owns Spanco? (In M'sia that is always the correct question to ask - since it explains everything!!!) http://ctchoolaw.blogspot.com/

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written by yellowkingdom, July 27, 2008 12:05:10

A source told The Star that the Government was Spanco’s only customer.

Clearly, any company depending SOLELY on one customer for its business spanning for 25 years till 2019 smacks of cronyism and nepotism. Where is the entreprenurial spirit and model towering Malay business tycoons that TDM spoke of ? Bodoh!

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written by New Frontier, July 27, 2008 12:50:44

The rakyat being spanked by SPANCO/UMNO/BN.

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written by Mark C, July 27, 2008 12:56:39

kekeke, really malaysia boleh!

hypothetically speaking, if the cars were bought by the gomen, say a toyota camry at 140k, in 3 years time the value of the car in the secondary market would be around 100k. meaning it has already lost 28% of the value. It's 2 years guarantee for manufacturing faults and 1 year free servicing, which means around 150rm for parts and oil, (labour foc). Second year for servicing a camry including labour etc etc is 350rm (Max) for every 15k kms.

which means, on the long run, the gomen will infact not burn 80 to 100 million yearly

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written by zonefinder, July 27, 2008 13:40:57

80m to service 1400 cars works out to be 57k per car. Thats besides the point. Frankly, this is hardly surprising as this mode of corruption is rampant across all facet of the Govt machinery. Proton local components costing 50% more than compared to Japan, Road projects 200% higher than actual costs...
Its our fault because all this while we have been indifferent and many of us condone by being party to these corruption ( anyone can claim not bribing the police before?). For 50 years, we have continued to support BN and many continue to support in name of business and political stability.
The next few months is going to be pivotal for the future of this country. Are we willing to sacrifice for some short term pain for long term gain? This is where we will be put to a test. Lets show our commitment for sake of our future and future of this country.

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written by Awang Hitam, July 27, 2008 14:33:37

Now you know why Maths is taught in English! Though I agree it is rightly so!
So that the UPMNO will say they can't do addition and deduction as English is not their mother tongue, especially under duress. Or is it undress?
Corruption has seeped so deep in every section/department of the BN government even to the top brass in Putrajaya that it is no longer possible for ACA to act.
What should be done? Simple.... Have a new G election, list out all contracts and expenses from every office and put up for us to see..

Is it possible? Nah! They will lose trillions of $$$ from existing and past projects not reported in the DG of Finance and Public ACcoount Committee.

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written by mgeo, July 27, 2008 15:13:43

RM 80 million to LEASE and maintain 5600 cars of various makes, and replace them every 4 years.

Assuming no purchase tax and cost of about RM 50,000 per car, this works out to RM 7,000 for maintenance over 4 years or RM 1750 per year.

Would an "ahli corporat" be satisfied with this? I suspect the real story is in billions.

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written by sarawakian, July 27, 2008 16:20:01

This works out to about RM12,000 annually to maintain each of the locally-made luxury-line Proton Perdana leased from Spanco

RM1,000 per month to maintain them? or is that part of the lease? surely, these NEW cars don't suffer such high maintenance cost. also, after 4 years, SPANCO can still sell them off at RM60,000 per unit.

moreover, other than Perdanas, they also supply 4WD and Waja to other departments.

where is the transparency?

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written by MyView, July 27, 2008 17:11:19

The rakyat being spanked by SPANCO/UMNO/BN. ???!!!

Halo brade. check balek Spanco ni sapa punye.
Ministry Transpot bpunye crony laaa ooi.

MAC punya lah ...tak pecaya kah. Tanya Tun LLS

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written by MyView, July 27, 2008 17:14:08

Not all gov business UMNO sapu, MAC pon dapat . MIC pon dapat.

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written by Lim Lim, July 27, 2008 17:36:57

rm 80,000,000.00 per year x 25 years =rm 2,000,000,000.00 !!!
this is definitely jus another big 'kebocoran'!!habislah rakyat!
SPANCO,another must be 'one for u n two for me' umno/BN entity??

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written by Lim Lim, July 27, 2008 17:57:05

SPANCO gate??another 'gate' in the making to add on malaysian's plate???

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written by lynn, July 27, 2008 18:20:20

Spanco's outrageous deal was sealed during Dr M's time. Even after he resigned as PM, his legacy continued; it is the same story elsewhere, the practice of paying RM50 for a RM1.00 screw kind-of scenario. This is happening every day, Malaysians are screwed, ****ed, sodomised, raped everyday by a corrupt govt & not realised it. Even if they realised it, they would still vote bn. Anyone in his right mind would not vote umno, mca, mic or gerakan. 50% of Malaysians are majorly ****ed-up - their thinking process is missing or twisted, flawed and/or diseased.

If the private sector sells to the govt dept. the same scenario is repeated, but in millions. On smallish,petty scale, as told by a shop proprietor, a Malay govt employee went to his hardware shop to buy stuff for RM40.00 & he was told to issue a receipt for RM80.00. This is outright cheating & fraud.

What do you call a case whereby a company sold goods to a state govt for RM7.0 million when the merchandise was at cost, worth less than half a million? Do you call this a good deal or do you think the rakyat has been ****ed by more such "fixed deals"? This kind of deals are deliberate & the payoffs done after the seller gets paid. Kindergarten stuff. You can figure it out.

It's the rakyat's money, isn't it? The trouble in Bodohland is, people think the govt owns the money. But in truth, legally the rakyat of Bolehland owns the money. The govt including ministers are merely goverment servants and they are employees of the rakyat... pls keep up the good work, keep exposing the corruption in Bodohland. All we can do is, hope more Bodohland voters straighten out their brains & cast their votes wisely the next time round.

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written by Forex, July 27, 2008 22:44:42

It does not make sense for govenment to use luxury car. In my place, the Pegawai Pendidikan Daerah using a very expensive 4WD car from japan costing around RM300,000-400,000 (Market Price). The driver told me, the monthly oil, etc etc charges was so high on par with the PPD's salary. There were 12 of these kinds of 4WD use by goventment in SABAH.

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written by Sabahfan, July 27, 2008 22:57:07

AND without doubt, Spanco s/b is owned by another UMNO leader who lives in an istana....

check it out

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written by Experienced, July 27, 2008 23:07:08

It is with interest I note the high costs of maintenance of leased government vehicles. Please note that they are not government vehicles. They are leased. From what I know all leased vehicles are serviced and maintained by the lessor and not the lessee. The lessee only pays the rental and fills in the fuel. For all other wear and tear it is the lessor's responsibility, including tyre wear, oil-changes,etc. The condition of the vehicle shall be subject to the satisfaction of the lessee.



A study can be done how all leases are done in the real private sector as opposed to a created one. Investigations can be done to ascertain why all these problems came about. The lessor cannot eat the cake and have it too. Public funds cannot be taken for a ride. We must find out who are the benefit-holders because there are no stake-holders where it is a one-sided arrangement of the public booty.

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written by howiseveryone, July 27, 2008 23:09:36

while we don't know exactly how much of our Rakyat's money was wasted, we know for sure that at least (from 1994-2003) 9 years x RM20million = RM180million was wasted and went into the pockets of a few since they said that RM100million/year was excessive and revised to RM80million/year. With RM180mill can already buy over 70 merc!!!!!.

why are they making such a big deal about RM3 million on 14 merc when RM180million were given away for nothing????...

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written by Experienced, July 27, 2008 23:12:50

What about the Wajas supplied to the police by the thousands. Who is going to drive them? Police personnel converted to drivers. Who is going to do the policing. Drop the police at the designated places and ask them to walk. Show their presence, not their vehicles passing through. For summoning at parking places, they get off, but at places where drain covers get lost, they are not to be seen. Are they revenue earners, or police personnel, taking care of the needs of the public.

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written by alan cheong, July 29, 2008 01:31:36

writing on the wall is clear:

spanco = crony

so many external indie workshops are able to AND DO deliver better, if not just as well, work quality for less if not the same.

and just as 'mene, mene, tekel, upharsin' was clear on the wall back in babylon, so too, it is clear that umno/bn/fascist malays days are numbered.

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