PAC: HRD Corp boss misled board on Skills Passport issue

The Human Resource Development Corporation (HRD Corp) appears to have misled its board as well as the Human Resources Ministry to push through the Skills Passport project, the bipartisan parliamentary Public Accounts Committee found.

After hearing the testimonies of several board and management members, it found discrepancies over whether the board or the ministry had approved the project, and that both sides seem to have been misled to believe approval was given by the other side.

“The PAC found there were contradictions over what happened on Oct 6, 2022, particularly on the approval to include Neomindz Sdn Bhd as Skill Passport project executor.

“It is questionable why the HRD Corp CEO obtained the signature of the deputy chief secretary for the agreement when there was no need to do so. Further, the deputy chief secretary has no jurisdiction to approve such a deal.

“The PAC believes the CEO had given the impression to the board that the project was approved by the ministry,” the committee said in its report published yesterday.

This comes after Auditor-General Wan Suraya Wan Mohd Rodzi in her report proposed that the ministry refer HRD Corp to enforcement agencies following an “unsatisfactory” audit.

Minutes don’t match

Although HRD Corp chief executive Shahul Hamid Shaik Dawood testified to the PAC that the board had approved the project on Oct 6, 2022, a board member insisted this did not happen.

Rosli Yaakub, who represented the Finance Ministry, said Shahul had merely added a slide about Skills Passports at the end of his “CEO brief” presentation to the board on Oct 6, 2022.

However, the meeting minutes published on March 28, 2023, stated that the board had approved the project.

Rosli said he then wrote a letter to all board members to highlight the error, but by then, the ministry had already approved the project and a deal had been signed with a private company.

“It wasn’t a proposal for approval, no. A CEO update only - a report by the chief executive on the status of what is happening in HRD Corp…

“He was actually only reporting to the board, a CEO update, but he slipped the update inside at the end, a slide that he is proposing this Skills Passport project. I don’t recall any proposal paper,” said Rosli, who is the deputy secretary of the Finance Ministry’s Statutory Body Strategic Management Division.

Further, he said, the management had made it seem like HRD Corp has no financial obligation to vendor Neomindz Sdn Bhd, but in fact, the agreement exposed HRD Corp to financial liability.

In the agreement, it is stated that HRD Corp must pay Neomindz RM12 for each Skills Passport user, the PAC found. However, Shahul said users paid the vendor RM8, of which HRD Corp receives RM2.

Other board members corroborated Rosli and said the details were only discussed in subsequent meetings after the agreement was already signed.

They testified that acting chairperson Rajasekharan Ramasamy had on March 28, 2023, asked members of the board if they agreed to the deal but the agreement was already signed on Feb 17, 2023.

It was signed one day after HRD Corp received “approval” from acting Human Resources Ministry chief secretary Muhd Khair Razman Mohamed Annuar.

In turn, Khair told the PAC, he received a letter from Shahul about it on Feb 16, 2023, and was asked by the minister at the time, V Sivakumar, why the ministry had not cleared it if there was already board approval.

Khair said there was no need for ministry approval if the board had given the green light and he had minuted on the letter that the matter should be taken to the board in full quorum.

What is ‘Skills Passport’?

Skills Passport is an online database which collates the certification and skills of individuals so employers can easily verify the credentials of applicants and seek talent in the areas they are located.

According to HRD Corp chief operating officer Ariff Farhan Doss, who proposed the project in April 2022, the idea was to build this database in-house, but “somewhere along the line (he) was told the minister had some good people whom he wanted to be involved”.

At the time, the minister was M Saravanan, who told Ariff “there are individuals with expertise in this area who should be given the opportunity to build this for HRD Corp”, he told the PAC.

He added that initially, the system was supposed to be a free service for users but “just as we were negotiating (with a service provider), suddenly we found out there was an agreement” with a company in India to provide the service.

However, Ariff said the Indian service provider could only provide the back-end technology and not the front-end user interface.

Finally, Neomindz was contracted, he said, but he was not involved in the deal.

The deal was finally scrapped by current Human Resource Minister Steven Sim in December 2023 after much controversy and an internal audit was commissioned by the government.

The controversy was sparked when Rosli’s letter to the board disputing the meeting minutes was circulated online.

Rosli told the PAC that Sim had personally told him he read the letter twice and had cancelled the deal as a result.

Unlike the PAC findings, both the internal and external audits found nothing amiss - something ministry deputy chief secretary Amran Ahmad found “doubtful” (musykil) as he was not in the ministry when the deal was signed.

“Based on my reading of the internal audit reports, there is no wrongdoing or abuse that happened. It arouses doubts, it’s quite doubtful,” he said, laughing.

Further, the COO, Ariff, said although he knew there was an audit on the project, he was not interviewed by the auditors.

On his part, the minister at the time Sivakumar said he found it “confusing” how there were allegations of wrongdoing when the project was not even implemented and that the external audit found nothing untoward.

Who is Neomindz?

Malaysiakini’s checks on the Companies Commission of Malaysia (CCM) database on July 5 found no company named Neomindz Sdn Bhd.

However, other job-seeker websites indicate that it is in the field of medical technology, STEM education, and IT solutions, and is based in Mont Kiara, Kuala Lumpur.

Its listed website is not active and its last post on its social media accounts was about a year ago.

However, in his testimony, Rosli said his own checks on the CCM database found the company was half owned by Indian national Jayamohan Parameswaran Madhusoodhenen Nair, which was a security concern given it will have access to personal data.

“(Shahul’s) response was: ‘So what? Can’t foreign companies get Malaysian contracts?’,” Rosli told the PAC.

Rosli said he was also not confident of the company’s financial standing as it had cash reserves of RM36,355 but liabilities of RM144,400.

He said the other shareholder is one Gobi Ramasamy, a Malaysian with an Ipoh address.

When Rosli’s letter to the board went viral, HRD Corp threatened legal action against those who published the letter and claimed that the contents were protected by the Official Secrets Act.

Malicious campaign against HRD Corp

Shahul, the chief executive, also defended the programme and said that the campaign against Skills Passport was “malicious”.

“To be fair, that was a completely malicious attempt to bring down the brand of HRD Corp,” he told the PAC.

He said skill passports have been implemented successfully in India and Australia and could have been as successful in Malaysia.

He also insisted there would have been zero cost to HRD Corp, whereby Skills Passport users would pay RM8 to the vendor, and HRD Corp would take RM2.

Shahul also accused Rosli of sabotage, including leaking information to the media, and proposed to the government to remove him from the board.

“The audit report shows HRD Corp is a clean sheet. We follow all the processes, no issues. One thing, in spite of that, we also took a third party to audit us, to make sure that our hands were clean and we went through a whole proper procurement process.

“But, so much damage has been caused. So, when we have the opportunity, we never want to have a board member who has issues of integrity, governance, leaking information to the public, to be sitting on the HRD Corp board because we discuss a lot of private and confidential things with the board,” he testified.

Ministry submits report to MACC on HRD Corp mismanagement

Human Resources Ministry welcomes probe by authorities over audit findings

We undertook reforms to improve governance, HRD Corp says

PAC member: Govt acted on 3 steps towards reform this house session

Consider turning HRD Corp into statutory body, PAC tells HR Ministry

HRD Corp fails audit, auditor-general wants enforcement agencies to step in