It is predicted that up to 30 percent of Malaysia's public projects' value was lost owing to mismanagement and corruption, revealed auditor-general Ambrin Buang.

Citing the study of Organisation for Economic Cooperation and Development (OECD) and World Bank, he said corruption in the infrastructure and extractives' sectors had contributed to the misallocation of public funds.

“It is difficult however to measure the exact cost. It has been estimated that between 10 to 30 percent of the investment in publicly-funded constructions projects may be lost through mismanagement and corruption and the estimation of 20 to 30 percent of projects' value lost through corruption,” he told an anti-fraud forum in Kuala Lumpur today.

Titled “Combatting procurement fraud in the public and private sectors forum 2017”, it was attended by 100 public servants and private sector.

As Ambrin was unable to attend the forum, his speech was read out by National Audit Department director of audit Roslan Abu Bakar.

The proliferation of corruption, Ambrin added, would distort Malaysia's competitiveness and market while foreign investors may lose their business appetite.

Gov't takes measure to curb

Despite the auditor-general's annual report reviewing the misappropriation of public funds, valued at millions, the national top auditor noted the government had taken several steps to mitigate.

This included strengthening the role of internal auditors, across-the-board auditing of procurements in government departments and agencies by National Audit Department and having more focused training on procurement management.

“As for internal auditors, I think they should now be more actively involved in reviewing the procurement exercises and reporting on any deviations from the standard operating procedure and lack of diligence in evaluating bids.”

Quoting from six recommendations of OECD report, Ambrin said it could reduce the public procurement's abuse.

Among them are integrity, transparency, citizen involvement in public procurement, accessibility, e-procurement and oversight and control.

Foster anti-democratic environment

Ambrin also said corruption would erode the society.

“Corruption is a social phenomenon that fosters an anti-democratic environment; characterised by uncertainty, unpredictability and declining moral values and disrespect for constitutional institutions and authority.

“The implications of graft-related practices in the procurement systems have manifold negative consequences, most of which are manifested in economic, financial and social dimensions.”

Ambrin urged the government to continue its curb against corruption.

Meanwhile, Malaysian Anti-Corruption Commission (MACC) community education director Abdul Samat Kasah, who was one of the speakers, suggested seven recommendations to combat corruption.

These are establishing the right culture, hiring the right people, assessing internal controls, developing a fraud response plan, knowing your supplier, supplier capacity and sub-contracting and monitoring the procurement process.