MACC finds a slew of faults in NFC deal

It was a scandal that left the government red faced and forced a cabinet minister to relinquish her post.

And the Malaysian Anti-Corruption Commission (MACC) has now revealed that the Agriculture Ministry, then under the helm of Muhyiddin Yassin (left), had awarded the National Feedlot Centre project to a company without technical or financial capabilities.

In its 2012 annual report released today, the commission outlined a slew of faults in the awarding of the contract.

Among others, MACC pointed out that there was no consideration of conflict of interest between any government officer and the recipient of the government soft loan for the project.

"There is no code of ethics for government officers to declare any conflict of interest, if immediate family members receive loans from the government," added the commission.

MACC said the Agriculture Ministry "did not do due diligence" on the company awarded the project.

"The Agriculture Ministry failed to select a truly competent company to run NFC as it was selected through limited tender.

"The company which was allowed to present their proposals did not have technical background or strong financial standing," it said.

The report also revealed that the decision to award the contract and the terms for the loan were not discussed in or approved by the cabinet.

The MACC report, which found 12 faults with regard to the NFC project award, would be submitted to Prime Minister Najib Abdul Razak.

The NFC project was awarded to the National Feedlot Corporation, run by the husband of then cabinet minister Shahrizat Abdul Jalil (right) and their children.

Shahrizat, who resigned following the debacle, had since said she was unaware of her family's business activities.

Her husband Mohamad Salleh Ismail had been charged with criminal breach of trust involving the use of funds from the RM250 million soft loan.

The soft loan was given at an interest rate of 2 percent and accompanied by a RM13 million grant.

Other faults found by MACC include:

• Failure to include a clause barring the loan recipient to transfer the money to subsidiary companies or other companies;

• Failure to conduct viability and market research, resulting in the project failing to meet objectives;

• No proper guideline on the process of obtaining and disbursing;

• Total amount of and interest terms for the soft loan is based on the Finance Ministry's recommendation but there is no guideline on how to set such terms;

• Improper documentation of award;

• Responsibilities of the Agriculture Ministry, Negri Sembilan Menteri Besar Incorporated and Economic Planning Unit not spelled out;

• Board members on National Feedlot Corporation's board of directors representing the government's golden share did not play their roles;

• The appointment of an authorised technical officer, instead of an authorised technical committee to oversee the project gave room for manipulation; and

• The government did not build the abattoir as agreed, thus delaying the project.