Proposal to use special guarantee fund for sick projects to be submitted to MOF

KUALA LUMPUR: The proposal to use the special guarantee fund to restore sick or abandoned projects, announced in the recent Budget 2024, will be submitted to the Ministry of Finance (MOF).

Deputy Local Government Development Minister Akmal Nasrullah Mohd Nasir said that, among the points in the proposal, was to use the fund for affordable housing projects under RM300,000, and for projects with at least 80 per cent progress status.

“Apart from that, we are also looking at housing programmes under federal government agencies and state authorities, especially affordable housing projects which are at risk of becoming sick projects,” he said, during a question and answer session in the Dewan Rakyat, today.

He said this in his reply to a supplementary question from Zahir Hassan (PH-Wangsa Maju) regarding the method implemented by the government to resolve the issue of housing projects classified as sick or abandoned projects.

Akmal Nasrullah, in his reply to Zahir's original question regarding the Housing Development Account (HDA) for housing projects, said that, thus far, the Ministry of Local Government Development (KPKT) has frozen 20 HDA accounts for projects categorised as sick or problematic.

He said the move was based on an investigation that showed the developers were neglecting their responsibilities and could affect the interests of buyers.

“In addition, developers can also be compounded up to a maximum of RM50,000 if they fail to fulfil their obligations as stipulated under Act 118 (Housing Development (Control and Licensing) Act 1966) and its regulations.

“A total of 284 compounds have been issued for offences under section 7 (e) of Act 118 in 2022 and 2023.

He added that KPKT, through the National Housing Department (JPN), always ensures that licensed housing developers comply with HDA-related provisions, including conducting HDA management audits of licensed housing developers; monitoring housing developers’ financial progress reports and blocking applications for withdrawals from HDA if they do not comply with Act 118 and its regulations.

He said this in his reply to Zahir's original question regarding how HDA can control the problem of sick and abandoned housing projects as well as compliance or non-compliance with the use of HDA accounts among developers.

Meanwhile, answering a separate question raised by Chiew Choon Man (GPS-Miri), Akmal Nasrullah said that a total of 256 private sick housing projects were successfully revived this year.

He said that it involves the successful completion until obtaining the certificate of completion and compliance (CCC) and changing the status of the projects (from sick) to smooth which covers 28,363 housing units with a gross development value (GDV) of RM23.37 billion.

“Sick projects which were successfully revived to receive CCC are as many as 225 projects or 19,945 housing units with a GDV worth RM18.09 billion, while those that changed the status (from sick) to smooth involves 31 projects (8,418 units) according to the set completion period with a GDV worth RM5.28 billion,” he said.

He added that the task force for sick and abandoned private housing projects (TSFT) confirmed that as of Aug 31, there were 90 delayed private housing projects (9,376 housing units) and 485 private housing projects in the sick category (78,626 housing units).

Responding to Chiew’s supplementary question regarding the monitoring of sick projects in Sabah and Sarawak, he said that private housing projects in Sabah and Sarawak are outside the KPKT’s purview and are subject to the Sabah Housing (Control and Licensing) Enactment 1978 and the Sarawak Housing Development (Control and Licensing) Ordinance 2013.

However, he said that the Sarawak government intends to carry out the integration of the housing system in Sarawak with KPKT through the Housing Integrated Management System (HIMS) so that the tracking of private housing projects between the Peninsula and Sarawak can be carried out systematically.

-- BERNAMA