Malaysia government loses RM28.79 million due to delayed vehicle replacements

The Malaysian government has lost RM28.79 million because of delays in replacing leased vehicles, according to the Public Accounts Committee (PAC).

Datuk Mas Ermieyati Samsudin, the PAC chairman, stated that 5,323 vehicles were leased beyond their original 48 to 60-month terms. This extended leasing meant ministries and agencies had to pay full monthly rental costs for old vehicles while also bearing significantly higher maintenance expenses compared to new ones.

The PAC's investigation into the government vehicle concession agreement, managed by the Ministry of Finance with SPANCO Sdn. Bhd. for 15 years, revealed management weaknesses. These included communication gaps between the Finance Ministry and user agencies, confusion over penalty application timelines, and the ministry's failure to distribute contract documents. Consequently, the government was late in collecting millions in penalties from SPANCO for delayed vehicle deliveries.

Mas Ermieyati noted a substantial difference between the initial audit estimate of RM54.51 million in penalties and the RM18.7 million figure later revised with user agencies for 27 ministries. She also pointed to internal government issues, such as changes in vehicle model variants and agency bureaucracy, contributing to the delays.