KUALA LUMPUR – PKR parliamentarians call out the Human Resource Ministry to explain its intention in appointing a third-party auditor to re-audit the Human Resources Development Corporation (HRD Corp).
Wong Chen (Subang-PH) questioned if the ministry is looking to dispute Parliament’s Public Accounts Committee (PAC) and auditor-general (A-G) findings on HRD Corp.
Wong, with Chiew Choon Man (Miri-PH), Hassan Abdul Karim (Pasir Gudang-PH), and William Leong (Selayang-PH), have expressed their concerns about the ministry’s decision, as recent media reports have stated that government agencies do not need to wholly accept or agree with the A-G Report, and that they are free to obtain third-party views.
Wong said this would open the doors for other ministries and government agencies to question the National Audit Department’s report and indirectly undermine the A-G.
“We want the ministry to clarify if the independent auditor will re-audit HRD Corp to challenge the National Audit Department and PAC or to improve the management of the corporation.”
Earlier, Human Resources Minister Steven Sim said the ministry is looking to appoint an independent auditor following alleged irregularities in the PAC and A-G’s report, which was published on July 4.
The minister said that this is to ensure transparency, adding that the process of appointing a third-party auditor will be done by July 31.
Meanwhile, Wong, with the other MPs, said they will be writing in recommendations to the Minister in the Prime Minister Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said to look into amending the Pembangunan Sumber Manusia Berhad (PSMB) Act 2001.
Wong claimed that among other matters that need to be considered for amendments include HRD Corp’s chief executive’s power in making decisions on investments.
“The power of the CEO to make investment decisions needs to be removed, and that is quite obvious. What we are really concerned about is the companies that HRD Corp has invested in, which includes Berjaya Foods.
“The corporation also invested in a company with links to one particular person in question, which are not blue-chip companies.
“So supposedly, if the corporation is a government agency, their money is supposed to improve employee benefits or skills.”
While acknowledging that the company can make some investments, Wong emphasised that such investments should go into bonds, fixed deposits, or other non-contentious investments.
Meanwhile, Leong stressed the importance of looking back at HRD Corp’s primary objective.
“The objective is the levy collection for training. This is not an investment firm to collect the money from the public and buy shares, bonds. So the objective and the focus must be reviewed.
“If they need to save some money, then they should do so in fixed deposits, buy bonds, or something that is certain.
“HRD Corp needs to understand that they are not there to invest in equities, as they don’t even have a proper mandate.”
Earlier, HRD Corp’s former chief operating officer Datuk Ariff Farhan Doss said the company would set a “dangerous precedent” if permitted to appoint its own independent auditor to challenge the findings of the investigations by the PAC and A-G.
The audit report recommended that the Human Resources Ministry take appropriate action against HRD Corp’s management by referring them to enforcement agencies.
The report also raised several concerns, notably regarding HRD Corp’s move to amend its key performance indicator goals for 2020-2023 without board approval, as well as the alleged misuse of levies collected from employers meant for training purposes that were instead spent on investments and asset purchases.
According to the audit, actions and decisions by HRD Corp’s management failed to adhere to procedures and neglected to safeguard the corporation’s interests essential for achieving its objectives.
Similarly, the PAC’s three-volume report on the corporation identified, among other issues, poor governance practices by HRD Corp’s management and suspicious procurement methods in real estate, resulting in significant financial losses for the corporation.
The PAC report also revealed a levy collection totalling RM3.77 billion from employers using HRD Corp in various investment activities.
Following this, the Malaysian Anti-Corruption Commission (MACC), on July 9, said they began probing HRD Corp for criminal elements after visiting the corporation’s office in Jalan Beringin to obtain documents for its probe on discrepancies highlighted in the A-G report. – July 18, 2024