KUALA LUMPUR: The government has agreed to adopt leasing methods to procure helicopters for security forces, as it is more transparent and alleviates the country's financial burden, said Prime Minister Datuk Seri Anwar Ibrahim.
Anwar, who is also the Finance Minister, said in the Dewan Rakyat today that leasing arrangements would ensure transparent negotiations conducted via government-to-government (G2G) agreements, without the involvement of agents.
He said that while some countries may purchase helicopters at a lower price, the maintenance costs over time often surpass the initial purchase cost.
"Leasing helps alleviate the burden of maintenance, which is a significant issue. Maintenance costs run into billions of ringgit annually, including repairs and natural wear and tear.
"Therefore, I support continuing the leasing arrangement that has already been decided. However, it is not a direct negotiation process; we issued a request for proposal (RFP).
"The main priority is ensuring proper maintenance, repair, and overhaul. This is why countries like Singapore, Indonesia, and the Philippines also use leasing methods," he said.
Datuk Seri Ikmal Hisham Abdul Aziz (PN-Tanah Merah) questioned why the lease contract for helicopters for the Malaysian Armed Forces, under the leasing arrangement, was not offered via an international open tender or executed through a G2G agreement.
Anwar clarified that Weststar Aviation Sdn Bhd was selected from four companies based on their submission through the RFP process.
"The evaluation focused on key criteria, beginning with the ability to secure substantial capital. The initial capital requirement of RM122 million was something many other companies could not meet.
"Weststar also holds the necessary certifications, including the Air Operator Certificate, Approved Maintenance Organisation, Directorate General Technical Airworthiness, European Union Aviation Safety Agency certification, and employs 135 certified pilots, among others," he said.
Anwar said that the government prioritises local companies with a proven track record and strong performance when selecting contractors.
He added that Weststar currently operates 28 Leonardo helicopters inherited from a previous contractor and has extensive contracts in Saudi Arabia, leveraging its vast experience.
"We are proceeding with this company, but under the condition that all assets meet the needs of various agencies, including the navy, air force, police, armed forces, fire department, and the Prime Minister's Department.
"The lease agreement also requires that the helicopters maintain an 85 per cent operational readiness rate, which is a critical condition," he said.
Additionally, the government has stipulated collaboration with local training institutes, including Universiti Teknologi Malaysia and the Royal Malaysian Air Force, to strengthen Malaysia's position as a hub for aviation training and operations.
Anwar said that Leonardo operates similar hubs in Italy and Miami, with Malaysia set to become the third.
"Melaka has been proposed as the hub location due to its proximity to Batu Berendam Airport, which we have agreed to develop into a training centre for Leonardo helicopters," he said.