The Human Resources Development Corporation (HRD Corp) has suspended three members of its management following reports from the Public Accounts Committee (PAC), the auditor-general, and the MACC.
In a statement today, the government-linked agency said the move was taken due to findings and recommendations detailed in the reports concerning the management of “unutilised levy”, the acquisition of Menara Ikhlas, and HRD Corp’s equity investment.
The suspensions, it added, also came after a “recent discovery” relating to the New Core System (NCS), which involved a procurement amounting to RM14 million and has been delayed for more than four years following three unsuccessful user acceptance tests.
The three management members affected by the suspensions were not named by the agency tasked with human capital development.
HRD Corp’s CEO Shamir Aziz, who was appointed to the position on Jan 23, said the agency will implement an internal investigation process that is transparent and conducted with integrity, with a clear mandate, scope and terms of reference.
This, he said, will include the review of documents, financial records, approvals, meeting minutes and relevant audit trails, as well as the taking of statements and verification of facts from relevant officers.
He further assured that such endeavours will be subject to the principles of natural justice and the confidentiality requirements of the investigation.
He added that the governance and recovery measures are being implemented in line with Human Resources Minister R Ramanan’s aspirations.
Shamir noted that Ramanan has emphasised a higher standard of integrity, transparency and accountability in workforce institutions, ensuring that HRD Corp’s stewardship translates into real, measurable outcomes for employers and Malaysian workers.
Under scrutiny
In July 2024, HRD Corp came under scrutiny after a report by the National Audit Department flagged the company for mismanaging hundreds of millions of ringgit in training grants, investments, and property purchases.
Among other issues, a total of more than RM50 million in training grants were disbursed to the same individuals multiple times, while more than 200 were deemed “suspicious” by auditors.
The auditors, who urged the Human Resources Ministry to refer HRD Corp’s management to the relevant enforcement agencies, also found poor governance in HRD Corp’s investments of RM3.727 billion, resulting in unrealised losses of RM49.38 million.
Parliament’s PAC had also uncovered similar concerns, with its probe revealing instances of posh events, overseas trips and high-risk investments - fuelled by interests from accumulated levies paid by employers.
On Dec 9, 2024, the PAC said it was bewildered by the MACC’s decision not to pursue further action against HRD Corp, despite the auditor-general’s statement that there is an element of criminality or abuse of power in HRD Corp.
Earlier, during PAC proceedings involving allegations against HRD Corp, MACC investigative officer Fuad Sedet told the committee that the graft-buster found no wrongdoing in its investigation.
MACC chief commissioner Azam Baki later clarified that the anti-graft agency’s investigation into HRD Corp is ongoing.
Strong governance, effective monitoring
In its statement today, HRD Corp vowed to ensure strong governance and effective monitoring.
It said one of the ways such efforts will be enforced is by ensuring that the implementation of approved training programmes must only take place after a minimum period of 21 days to three months from the approval date.
“This timeframe provides employers and training providers with sufficient lead time to undertake proper planning and preparation, including venue booking, participant registration and the coordination of logistical arrangements,” HRD Corp said.
It highlighted that at present, the absence of systematic monitoring for approved training programmes has weakened governance controls and oversight, with instances where training programmes were conducted prior to approval, while grant applications were submitted only after the training had taken place.
“To address these gaps, HRD Corp will progressively strengthen its monitoring and enforcement framework by deploying officers on the ground to oversee the implementation of training programmes.
“This approach is aimed at reinforcing compliance, accountability and good governance, while ensuring that all approved training activities are carried out in strict accordance with new and enhanced policies that will be instituted, as well as established approval conditions and regulatory requirements,” it added. - Mkini
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