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INHERENTLY, public procurement has always been a weak point in the administration as the civil service lost its influence over the decision-making process.
The erosion began in the early 1980s during Tun Dr. Mahathir Mohamad’s first term as Prime Minister and continued throughout the years. It all started with the influence of politicians in key appointments in the public administration.
All important appointments, even at the ministerial level, were not made without some kind of tacit support from the Prime Minister of the day, his wife, or the great politicians. In return, public officials owed favors to politicians. Over time, the public administration became subservient to its political masters rather than ensuring that the nation’s coffers were well managed.
A weak civil service in debt to the political masters was one of the hallmarks of the Barisan Nasional government that ended in 2018. Five years ago it was common for the head of the treasury or the secretary general of a ministry to ask his subordinates to support to certain ministers. .
The civil service received a rude wake-up call on May 9, 2018. After the change of government, the heads of the public administration discovered that they would be responsible for any signing of documents, especially when it comes to acquisitions.
The testimonies of public officials in court cases involving Datuk Seri Najib Razak, his wife Datin Seri Rosmah Mansor, Tan Sri Mohd Isa Samad and a host of other great political players are ample evidence that public officials gave in to the pressure. of politicians.
Even professionals who are hired to fill key positions in government agencies bow to politicians. Testimony from former 1Malaysia Development Bhd CEO Datuk Shahrol Azral Halmi reveals how weak he was in managing the federally sponsored fund even though he arrived with excellent credentials.
When Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz revealed in Parliament that the Pakatan Harapan government signed contracts worth RM6.1bil without calling a tender during his 22-month term in Putrajaya, it created a scandal.
However, a day later, details revealed revealed that more than 90% of the contracts were delivered during the Barisan regime. Zafrul’s reveal, if it was intended to embarrass Pakatan, has failed.
The largest contract, phase two of the Klang Valley Double Track (KVDT) Rehabilitation Project, was nearly RM4.5bil to RM6.1bil. The recipient is Dhaya Maju Infrastructure Asia Sdn Bhd (DMIA) whose 30% partner is Lembaga Tabung Angkatan Tentera (LTAT).
Indeed, the appointment of DMIA-LTAT, which came days before the dissolution of parliament in April 2018, came under scrutiny in the first 10 months of the Pakatan government. The project was re-awarded at a lower price in July 2019.
Even during the current Perikatan Nasional government, speculation abounds that the project would be broken up and shared among a few players.
Tender fresh called
In the latest development, the Cabinet canceled KVDT’s phase 2 contract and will call for a new tender. Much thought would have been given before making the decision.
This is because when the government makes a contract, it is difficult to break it. As Warren Buffett had said, one has to think everything through before signing a contract because it would be impossible to “cancel the signature.”
In general, public officials would have thought hard and worked out an agreement that would have protected them from bearing the brunt if something goes wrong. But whether the award is the best for the nation is questionable considering that several of the contracts could have been better crafted.
Officials probably know all too well that eventually the political masters would decide who would win the contract. So his position taken is “why fight the system”.
Whether the government adopts an open tender, a restricted tender or a direct negotiation, it ultimately needs the tacit approval of some politicians at some level.
Ask any company that supplies or deals with the government and they will tell you that it is all about “building a relationship and a network” within the establishment.
There are provisions for the government to award contracts directly or through restricted tendering.
Normally, contracts of less than RM100 thousand are awarded through restricted tender in which the ministry would request that no less than eight companies participate in the exercise. The company with the best offer wins the tender.
Most of the time, the eight bidders are related, so the bidding is “somewhat fixed.”
For expensive items, contracts are usually awarded by open tender for the sake of transparency and the discovery of the best price.
Even in open tenders, companies would not be willing to do their best unless they have some kind of political sponsorship.
The close nexus between politicians and corporations is a reality in Malaysia, resulting in the award of many important contracts based on direct negotiations. Between 2014 and 2018, it was reported that no less than RM130bil of contracts were awarded on the basis of direct negotiation.
While many important jobs were awarded during the Barisan government, no major contracts were awarded during the Pakatan regime. The government and public officials were cautious and the process was tedious, as open bidding was the mantra of the Pakatan government.
Some corporations were favored by jobs over others. But due to intense scrutiny on the government, hardly any major initiatives were announced, except for an 18% reduction in toll rates.
Open tendering is a “must” for large contracts. There are provisions for the government to award smaller jobs based on direct negotiations or through a restricted bidding process.
The bottom line is that the money spent should be beneficial to the economy and people.
And public officials must be authorized to manage the process, whether through a bidding process or direct negotiations.
The jobs of politicians should be limited to supervising the work of the public administration.
M. Shanmugam is a former Star Specialist Editor. Opinions expressed here are those of the author.
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