The 2025 Auditor-General’s Report Series 3, tabled in the Dewan Rakyat today, said the vehicles were supplied late and that no claims or penalty charges were imposed.
“Audit analysis based on data from the concession vehicle management system found that as of Dec 31, 2024, a total of 6,028 vehicles were delivered between one and 508 days late, exceeding the 60-working-day delivery period from the order date.
“Audit checks revealed that, up to the time of the audit, there were no records indicating that any penalty claims had been made against the concession company(ies) involved,” the report said.
The report also found that the federal government had incurred an estimated RM28.79 million in additional costs by continuing to use concession vehicles with expired lease periods instead of replacing them with new vehicles within the stipulated timeframe.
The report also said that based on responses from the finance ministry, a penalty committee and penalty assessment working committee had been formed to review and determine the appropriate claims for submission by the ministries involved.
“The penalty committee, chaired by the deputy secretary-general of the Treasury (investment), comprises representatives from various divisions in the ministry as well as the accountant-general’s department,” it said.
The finance ministry is also reported to have held an engagement meeting with all ministries on Aug 18 to present the findings of the national audit department and outline the necessary follow-up actions.
The report said that the finance ministry signed a second concession agreement (CA2) on Jan 31, 2022 for the supply, repair, maintenance, and management of government vehicles.
CA2, which is valid for 15 years from July 31, 2022 to July 30, 2037, replaces an earlier concession agreement (CA1) which was originally set to expire on Dec 31, 2018.
CA1 was extended through four supplementary agreements before ending on July 31, 2022.
As of Dec 31 last year, a total of 14,459 concession vehicles had been supplied: 5,881 under CA1 and 8,578 under CA2. Of these, 11,322 were for government departments while 3,137 were official vehicles.
Increasing repair, maintenance, and ancillary fees
Under the concession agreements, the monthly payments consisted of leasing charges and varying repair, maintenance and ancillaries (RMA) fees, calculated for each vehicle supplied.
The older a concession vehicle becomes, the higher the RMA rate that must be paid.
“Between 2021 and 2024, ministries paid a total of RM1.75 billion for the leasing, repair, and maintenance of concession vehicles under both CA1 and CA2,” the report said.
The national audit department recommended that the ministry, as the contract administrator, take action to recover the estimated RM54.51 million in penalties and expedite the resolution of issues related to replacing vehicles with expired lease periods.