COMMENT | Massive migrant labour recruiting issues, cops must probe

COMMENT | On July 3, 2024, the Public Accounts Committee (PAC) led by Masjid Tanah MP Mas Ermieyati Samsudin reported that the migrant labour recruitment system under the Home Ministry was operating for six years without being formalised in a contract.

The Center to Combat Corruption and Cronyism (C4 Center) is appalled at these findings as as well as other related issues raised by the PAC.

C4 Center calls for further investigations to be made, for those found responsible to be held accountable, and for Parliament to introduce the necessary good governance reforms as a matter of utmost urgency.

The Foreign Workers Centralised Management System (FWCMS) is a crucial aspect of migrant labour recruitment in Malaysia, as the liaison for 5,400 recruitment agencies.

It was reported that the letter of acceptance for the FWCMS was issued on Jan 12, 2018, but the contract remained unsigned between the government and the service provider, Bestinet Sdn Bhd, up to March 13, 2024, implicating the Home Ministry in violations of standard government procurement as well as public-private partnership procedures.

Additionally, the PAC was told that 24 unauthorised users were approved by Human Resources Ministry officers to bring in migrant workers.

Bestinet Sdn Bhd has long been besieged with controversy - the company was raided by the MACC in July 2022 for alleged corruption and power abuse involving the selection of 25 Bangladeshi agencies for migrant worker recruitment.

Independent investigations into the company also uncovered that it was linked to politicians and other powerful individuals through the composition of its board members.

When Bestinet first bid for the FWCMS contract back in 2015, questions were raised regarding its board membership which included former home minister Azmi Khalid and previous director of the Labour Department Tengku Omar Tengku Bot. At the time, Ahmad Zahid Hamidi was home minister.

Government on the hook

Absurdly, on June 24, Home Minister Saifuddin Nasution Ismail announced that the government decided to extend Bestinet’s contract to run the FWCMS for another three years, despite there being no contract to begin with. In light of the numerous instances of misgovernance, how did this decision by the government even come to pass?

Furthermore, the government’s continued engagement with Bestinet is extremely questionable in light of the numerous criticisms relating to the company and its practices. This reflects especially poorly on the Home Ministry, which should be taking immediate accountability for this fiasco.

Frustratingly, the path to a solution seems to be obstructed by a “mutual termination” clause in the agreement between the government and Bestinet, requiring that the termination of the contract be agreed upon by both parties.

In the absence of mutual termination - more accurately, Bestinet’s refusal to terminate - the Malaysian government would be rendered financially liable to Bestinet, or at least render it open to legal action.

Why the Malaysian government would place itself in such a delicate situation truly defies logic. While it provides possible context for the government’s decision to extend Bestinet’s contract, it is not a satisfactory one and cannot serve as a substitute for all the outstanding issues that need to be addressed in relation to the misgovernance that had to take place to get to this point.

The individuals responsible

This leads us to the question of who the individuals we should be looking to now to provide avenues for redress as well as to be scrutinised for their role in cementing the deal at the point of offer.

Currently, it falls upon Home Minister Saifudin Nasution Ismail to inform the public as to what steps his ministry will take to address the issues raised, correct the misgovernance that has taken place, and the policy changes that will be necessary to mitigate the risk of a similar event repeating.

Just as, if not more, importantly, however, is that the leaders overseeing the contracting of Bestinet when the letter of acceptance was issued - Jan 12, 2018 - must be questioned and their role in the engagement explained.

This includes disgraced former prime minister Najib Abdul Razak, who was also finance minister at the time, and current Deputy Prime Minister Ahmad Zahid Hamidi who was home minister at the time.

Several extremely important questions must be inquired into and answered by the Home Ministry. Were internal audits or performance reviews ever conducted to ensure the contracting party was meeting their targets and reporting financial statements?

If such reviews and audits were conducted, why was the issue of the non-existent contract never flagged and addressed? How were these audits even conducted in the absence of a terms of reference document?

Over-supply of workers

It further calls into question the legal status of immigration emerging as a consequence of using this botched system — if 24 additional users of the FWCMS were allowed to bring in migrant workers without detection up until this point, were they bringing in more migrant workers than allocated in the national quota?

If so, who is held accountable when there is an over-supply of migrant workers in the country unable to find employment and secure proper documentation to remain in Malaysia?

Inevitably, it is the migrant worker who is exposed to the harms and precarity of the situation - despite intending to find legal means of work in Malaysia - while the individuals ultimately responsible for the illegalities are never truly held accountable.

C4 Center calls upon the government to take immediate strong action to remedy the situation:

• The relevant authorities must investigate who is responsible for such an integral contract to be left unsigned at the point of awarding the letter of acceptance, as well as the administrative failures that resulted in this issue escaping detection, or even possibly being obscured from scrutiny for this long.

• Once investigations have taken place, those individuals found responsible must be held accountable and subject to administrative sanction, and in the case where corrupt activity or motive is ascertained, they must be subject to criminal sanction as well.

• For future projects of similar national importance, the Auditor-General (AG)’s Office must be empowered and equipped to carry out audits on government projects, especially in light of the recent amendments to the Audit Act 1957 that expand upon the AG’s powers to be able to audit entities receiving government funding - oversight should be made a priority over the lifespan of a project, not only when misgovernance has already taken place and the harm irreversible.

• The government must introduce reforms to the procurement process that would guarantee oversight, stringent and transparent selection processes, performance audits, regular reporting of financial documents, and protocols for remedy in the instances of non-performance of a contract to be enshrined in law through the legislation of a Government Procurement Act.

While the discussion has focused on the misgovernance of a public function, we cannot forget that a core aspect of this issue is the movement and rights of migrant labourers who form an integral part of Malaysia’s economic and productive capabilities, yet are constantly sidelined and reduced to an afterthought.

Official statistics state that Malaysia has a migrant working population of approximately 2.3 million as of the fourth quarter of 2023.

Unofficial estimations have previously stated that a further 1.2 to 3.5 million migrant workers are undocumented as of July 2023, which strongly indicates that migrant workers form a larger proportion of the total labour force than is officially accounted for.

The government has recognised Malaysia’s increasing dependence on migrant labour in many industries - in retaining these workers, our systems for recruitment must be transparent to ensure humane working conditions and to prevent exploitation and corruption.

C4 CENTER is an independent, non-partisan, and non-profit entity with a vision of good and clean governance in Malaysia.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

Bestinet probe: PAC chief says 'Datuk Amin' not among witnesses

Decide on the use of Bestinet’s system, PAC tells Home Ministry

Bestinet contract extended under stricter conditions: Saifuddin

Controversial migrant worker system gets new lease, sources say