Audit finds over 6,000 concession vehicles supplied late

The Auditor-General’s Report has revealed that the management of government concession vehicles was less than satisfactory.

It found that concessionaires delivered over 6,000 vehicles late, and an estimated RM54.51 million in penalties was not imposed on the parties involved.

According to the Auditor-General’s Report Series 3/2025, tabled in the Dewan Rakyat today, the concession agreement between the Finance Ministry and the concessionaires - effective from July 31, 2022, to July 30, 2037 - stipulates that each vehicle must be supplied within 60 working days from the date of order.

“Audit analysis using data from the concessionaires’ vehicle management system found that as of Dec 31, 2024, a total of 6,028 concession vehicles were delivered late - between one and 508 days beyond the 60-working-day period from the order date.

“It was also found that, up to the time of the audit, there were no records indicating that penalty claims had been made against the concessionaires,” the report said.

Nearly RM30m in additional costs

Apart from the delays, the report found that the government had incurred additional costs estimated at RM28.79 million due to the continued use of 5,323 concession vehicles, with leases having expired between 2021 and 2024.

Based on the audit’s calculations, if the vehicles had been replaced with new ones within the stipulated period, the government would have only needed to pay RM94.64 million, compared with the RM123.43 million that was actually spent.

In this regard, the National Audit Department has recommended that the Finance Ministry, as the contract administrator, take action to recover the estimated RM54.51 million in penalties for the delayed delivery of concession vehicles and expedite the resolution of issues related to the replacement of expired lease vehicles.

Penalty committee

In its responses dated July 25, and Aug 18, the Finance Ministry said that it had established the Penalty Committee and Penalty Assessment Working Committee to review the penalty claims submitted by the ministries concerned.

The Penalty Committee, chaired by the deputy secretary-general of the Treasury (Investment), comprises representatives from various divisions within the Finance Ministry and the Accountant-General’s Department.

“The Finance Ministry held a liaison meeting with all ministries on Aug 18, to communicate the National Audit Department’s findings and the follow-up actions to be taken by the ministries,” the report said.

Regarding the use of expired lease vehicles, the Finance Ministry said it was to ensure that government service delivery was not affected, while also taking into account the supply issues faced by the concessionaire company in obtaining replacement vehicles from the manufacturers.

- Bernama

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