KUALA LUMPUR (July 9): YTL Communications Sdn Bhd has come out to refute allegations raised by the Ministry of Education (MoE) to reject its service in relation to the 1BestariNet project.

In a statement today, YTL Communications, the 60%-unit of YTL Power International Bhd, stressed that MoE failed to follow the contract phase award process as laid out in the project documents.

This includes joint review of the project performance, changes in technology, basic educational needs and price prior to the expiry of each phase and before parties reach agreement on the next phase.

"But on June 27, without even responding to our letter offering free services for the [six-month] period, the ministry announced the award of the internet services for the interim period to Telekom Malaysia, Celcom Axiata and Maxis.

"As no joint review was undertaken as required under the contract and no open tender called, we regard this as a breach of our contract," YTL Communications said, adding that many of the concerns raised by the ministry in its response could have been addressed via the joint review and any other means would be 'mere speculation'.

YTL Communications won a tender in 2011 to provide internet connectivity to 10,000 schools nationwide. It undertook phase 1 and 2 of the 15-year project, which ended at end-June this year.

Meanwhile, MoE announced in July 2018 that it would call a fresh open tender this year — which was postponed citing lack of budget. The ministry declined YTL Communications' offer to continue the service during a six-month interim period for absolutely free before the tender was called, and appointed the other three telco players instead for the period — supposedly for a fee.

In the statement, YTL Communications also addressed the RM41.88 million 'hidden cost' on the electricity supply for the telco towers involved in the project as alleged by the ministry, which the company said was clearly laid out in its tender for the project.

"There was nothing hidden about this cost. The ministry was aware of this at all times," YTL Communications said, adding that the allegation is unfounded.

"In our tender for the project, it was clearly stated that the price we offered was on the basis that the cost of electricity supply to the towers would be borne by the ministry. This was evaluated by the ministry and deemed the most cost effective offer," it said.

"The ministry had accepted this for both phase 1 and phase 2. In fact, the phase 2 agreement was signed in 2016 (after review and taking into account the Auditor General's report in 2013)," it added.

On the claim of potential loss of income from the rental of the telco towers, YTL Communications said it is the sole user of the towers.

"We do not rent any part of the towers to other telcos. There is therefore no commercialisation of the towers.

"It was agreed in our contract that the rental of the school sites would be determined by Jabatan Ketua Pengarah Tanah dan Galian Persekutuan (JKPTG). There is no loss of income for the government and the estimate of RM32 million is purely speculative," it added.

"During the [six-month] interim period all rental will similarly be determined by JKPTG and will be borne by YTL Communications so there is no loss to the government of potential rental," it further said.

YTL Communications went on to slam the ministry's claim of weaknesses in the implementation of phase 2 with regard to connection speed. "All bandwidth specification under the contract was determined by the ministry and not by YTL Communications.

"Therefore, if the teachers are dissatisfied with the internet speeds, it would be because the bandwidth that the ministry specified do not satisfy the requirements of the schools," said YTL Communications.

On the alleged cost for the usage of FrogVLE platform under YTL Communications as opposed MoE's proposed replacement Google Classroom, the company said it has offered to provide both internet service and the platform usage free of charge during the six-month period.

"If the ministry had accepted our offer for the free services during the interim period, the ministry would have i) saved the millions which it is now paying to the three internet service providers; ii) avoided disruption to the schools in the middle of the school year; and iii) the time to conduct a tender exercise following which they would have a properly defined solution and price.

"As a company that has worked with the ministry over the past seven years implementing a world class nationwide learning solution that the country should be proud of, we cannot help but be disappointed. We, however, remain committed to playing our part in improving education in the country," it added.