This comes in the wake of the littoral combat ship (LCS) scandal after Public Accounts Committee chairman Wong Kah Woh recently revealed that not a single ship had been completed although Putrajaya had spent RM6 billion on the project, which was given to Boustead Naval Shipyard (BNS) through direct negotiations.

Institute for Democracy and Economic Affairs (IDEAS) CEO Tricia Yeoh said the LCS scandal was another grievous example of poor compliance and governance in public procurement, and an abuse of the direct negotiation method.

“We need to stem the prevalence of operational mismanagement, uncontrolled project variations, the lack of timeliness of payment schedules, and general lack of enforced oversight in our procurement system,” said Yeoh in a statement.

She said IDEAS’ recent report highlighted the benefit of modelling an Act after an international procurement legislation such as the United Nations Commission on International Trade Law Model Law on Public Procurement.

The report stated that this would aid in providing a better accountability mechanism for direct negotiations and public procurements.

“The Act will also help improve transparency in defence procurement as Malaysia is ranked in Band D in the Government Defence Integrity Index 2020, a poor rank that indicates high risk of corruption in defence procurement.

“The LCS scandal should be a wake-up call for us to take a more serious measure to reform our procurement system,” added Yeoh.

She also said the Act was promised as part of the National Anti-Corruption Plan, a plan that was formulated by the then Pakatan Harapan government.

Last week, Wong said the defence ministry (Mindef) and BNS had ignored the navy’s views on the LCS project.

He also pointed out that the navy should have received five of the ships by August this year.