Terminating contracts without any reason can be abuse of power: Najib

KUCHING: Prime Minister Datuk Seri Najib Tun Razak said on March 2 the power vested in Penang Chief Minister Lim Guan Eng to terminate any contract awarded by the Penang Development Corp (PDC) at any time without giving any reason can be regarded as tantamount to abuse of authority.

He said a contract could not be terminated unless there had been a violation of the terms of the contact 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 told a news conference after opening the 12th general assembly of Parti Pesaka Bumiputera Bersatu (PBB) Sarawak, here.

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. -- Bernama