Kuala Lumpur, 14 March 2019 – The Institute for Democracy and Economic Affairs has released Brief IDEAS no. 16 titled “An assessment of select procurement initiatives in the National Anti Corruption Plan (NACP) 2019-2023.” The Brief was co-authored by Faiz Abdul Halim, a Researcher at IDEAS and Aira Azhari, Senior Research Executive with the Democracy and Governance Unit. The paper was launched at an IDEAS public forum titled “The NACP and the Road Ahead for Malaysia’s Procurement Regime”, held today at Concorde Hotel, Kuala Lumpur.
According to the NACP, the MACC found that from 2013 to 2018, the public procurement sector recorded the highest number of complaints (42.8%). In light of these findings, this Brief provides an early evaluation on select initiatives to address problems in public procurement within the NACP, particularly in Strategy 3 titled “Increasing the Efficiency and Transparency in Public Procurement.” This Brief then proposes a set of recommendations to improve the procurement regime such as ensuring the proposed complaints mechanism has the necessary capacity and powers, and providing for the full-disclosure of tender results from committees.
Ali Salman, the CEO of IDEAS, spoke positively of the NACP’s strategy though added that it is necessary to identify some shortcomings of the plan from the perspective of civil society organisations (CSOs). “My two senses on the framework itself is that it is very comprehensive, very wide ranging and I see it in two phases; one is more of institutional reforms, which is improving the procedures through increasing the capacity of the system” said Ali during his welcoming remarks.
“But the second aspect is more critical which is the political economy aspect, I do think that is a bigger question there, because it will need to address very fundamental directions of the economic policy.” he added.
In his keynote speech at the forum, Datuk Dr. Anis Yusal Yusoff, Deputy Director-General at the Governance, Integrity and Anti-Corruption Center (GIACC), Prime Minister’s Department (PMD) spoke of the importance of building a culture of trust in procurement by developing a mindset. He said “attitudes and mindsets cannot be measured by key performance indicators (KPIs) alone, they are intangible. The real engine to any delivery is mindset. Mindset is defined by the culture we ultimately inculcate in the system. We each develop in the little areas we are in charge. This culture has be instilled, has to be imbued and it cannot happen right here and now.” Dr. Anis explained.
Aira Azhari, while presenting the main points from the paper, notes that this is a preliminary study which IDEAS hopes to continue working on in more detail in the future. “We are thankful to our friends from C4 who has been working on procurement issues as well, and many of our recommendations here are built upon their proposals as well. Our paper puts emphasis on the importance of an ecosystem where information is freely available to the public through a Freedom of Information Act, which the NACP has included in one of its initiatives. We urge the government to make enacting this FOI Act priority in its efforts to combat corruption,” Aira said.
Sudhagaran Stanley, the Northern Unit Programme Officer at the Center to Combat Corruption and Procurement (C4) said that the NACP needs to address the loopholes in public procurement that have frequently exploited by contractors, bureaucrats and officials. During a panel discussion at the forum, he said “Malaysia already has good laws (Financial Procedures Act, Gov Contract Act, Circulars Letters Act, & various other Acts), however, the problem still remains to be there. Contractors and even civil servants know how to circumvent the entire system.”
Stanley believes that the plans to use technology such as Big Data, AI, and blockchain to tackle corruption is a positive move but adds that there may be a lack of expertise within the government on how to use these technologies. He emphasized the need for greater expertise in these technologies to effectively use them to combat corruption.
Ahmad Yazid Othman, CEO of Majlis Tindakan Ekonomi Melayu (MTEM), while positive on the NACPs initiatives, said any proposed reforms to the public procurement system need to account for the needs of Bumiputeras community. He adds that procurement should be used with the intention of developing a strong and independent Bumiputera entrepreneurial class. “The problems of the Bumiputera community must be acknowledged, and we must discuss how the Bumiputera agenda thus far has failed to serve the needs of those who truly needs assistance. The preferences that are set in the procurement system for Bumiputeras is meant to address those needs, but we must examine who is really benefiting from them,” added Yazid.
Brief IDEAS no. 16 can be downloaded from the IDEAS website here.