KUALA LUMPUR: The Auditor General’s (AG) Report 2/2025 has uncovered critical flaws in the Malaysian Army’s (TDM) procurement and contract management, raising concerns over national defence preparedness.
The audit highlighted delays, unclaimed fines, and improper procurement practices involving RM7.8 billion worth of armoured vehicle contracts.
Key findings from the report include a two-year delay in the delivery of 68 GEMPITA vehicles by a local contractor, resulting in an overdue fine of RM162.75 million.
The government had already paid RM7.52 billion despite the contractor missing deadlines.
Additionally, the RM53.93 million performance bond was insufficient to cover penalties.
Maintenance and spare parts delays for GEMPITA, ADNAN, and PENDEKAR vehicles led to unenforced fines of RM1.42 million.
The report also criticised small-batch procurement by Responsibility Centres (PTJs), bypassing open tender rules for purchases exceeding RM500,000.
The Defence Ministry cited Movement Control Order (MCO) disruptions as a cause for delays, but auditors stressed that timely enforcement of penalties could have mitigated losses.
The AG recommended structured contract timelines and centralised approvals for ad hoc procurements to reduce governance risks. – Bernama