On June 26, the Government Inspectorate published its findings after a comprehensive inspection of the execution and management of the project and the legal compliance in the planning, construction and land management of the new urban area on Thu Thiem Peninsula.
The Inspectorate indicated multiple violations and shortcomings of the HCMC government and agencies.
The municipal government issued regulations on construction management for the new urban area in a manner that was not in line with the then Prime Minister’s orders. As a result, the execution of the project was delayed.
Meanwhile, the then Standing Board of the HCMC Party Committee approved an average price of VND26 million per square meter for land in the project, half the level proposed by the relevant municipal departments.
In addition, the interest for the amount of money advanced by the city in the process of carrying out the project was not factored into the land price, leading to losses for the city.
In the land clearance process, the city amassed 221.68 hectares of cleared land in Thu Thiem but later used it as a means of payment for investors involved in build-transfer (BT) projects to build infrastructure for the new urban area. Such land should have been put up for auction under the current regulations, so using land to directly paying for BT road builders constituted an infringement of the rules on land bidding, use and management.
According to inspectors, the investors in these BT projects earned large profits owning to the massive gap between the city-approved land price and the market level.
The HCMC government picked Dai Quang Minh Real Estate Investment JSC as the sole investor for a project to build four key roads in the Thu Thiem New Urban Area without asking the firm to provide evidence of its experience and financial capacity, which went against regulations on investor selection.
The city approved an investment of some VND12.2 trillion for the four roads without having consulted with the relevant departments and agencies. The investments for some items were not in line with the law, causing losses of more than VND1.5 trillion for the State budget.
In addition, Dai Quang Minh executed the project, though it did not receive a construction license for many items, and most of the project’s components lagged behind schedule. However, HCMC’s relevant agencies failed to detect these violations or impose sanctions on the developer.
Inspectors also found that the municipal government had signed a BT contract with Dai Quang Minh using cleared land in Thu Thiem to make payments for the construction of the four roads without a decision approving the land use, hence a violation of the 2012 Pricing Law and the 2013 Land Law.
The city also asked Dai Quang Minh to pay more than VND4.2 trillion in land use fees. The company has paid only VND2.4 trillion to date.
As for the Thu Thiem 2 bridge project, HCMC authorities had earlier chosen Vietnam Construction and Import-Export JSC as the investor but later chose Dai Quang Minh as a replacement. It also adjusted the project from four lanes to six lanes but did not report the adjustment to the Prime Minister as required by law.
The municipal government approved a total investment of over VND4.26 trillion for the project, but the use of some VND252 billion was not in compliance with law.
Moreover, the city appointed the investors in the observation tower complex and Song Viet complex but did not auction the rights to use the land lots for these projects. The city government also collected land use fees from the investors, which ran counter to the law.
The appointment of Lotte Group as the investor in a smart complex project and Vingroup in a sports and entertainment complex project also went against the Bidding and Land laws. The land use fees have yet to be collected from these investors.
In addition, the city went beyond its authority to approve and adjust a compensation, site clearance and resettlement project costing more than VND38.6 trillion. Also, it illegally advanced, used and managed VND26.3 trillion from the State budget and did not annually return the advanced amount to the State budget in line with the State Budget Law.
The Government Inspectorate proposed the Prime Minister ask the HCMC government to repay bank loans worth VND4.3 trillion used for the project and collect the unpaid land use fees totaling VND1.8 trillion, plus interest, from Dai Quang Minh.
The inspectorate also suggested the State Audit Office of Vietnam review the total investment cost of the project and the land use fees in line with market prices to prevent losses for the State budget.
If the city fails to address the consequences of its violations prior to December 31, the Government Inspectorate will transfer the conclusions of the inspection to the Inspection Commission of the Party Central Committee to apply penalties to individuals and organizations under the management of the Politburo. The inspectorate will also propose the Prime Minister assign the HCMC government to take punitive measures against those responsible.
HCMC chairman Nguyen Thanh Phong today, June 27, told the local media that the city would quickly deal with the violations in the Thu Thiem New Urban Area project as pointed out by the Government Inspectorate. The HCMC government will report the case to the municipal Party Committee and hold a press conference.
Meanwhile, Le Thanh Hai, former secretary of the HCMC Party Committee, declined to comment when reached by local media, saying he had retired. The violations in Thu Thiem project mainly took place while Hai was serving as Party chief of the city.
By Le Anh
Thursday, Jun 27, 2019,19:05 (GMT+7
