Asia Mobiliti: Govt must enact procurement reforms

 

On May 24, Selangor state executive councillor on Investment, Trade and Mobility Ng Sze Han pushed back on concerns surrounding the appointment of Asia Mobility Technologies Sdn Bhd (Asia Mobiliti) as a service provider for Selangor Mobility’s Demand Responsive Transit (DRT) system in June last year.

This comes amid public backlash over the company’s links to Youth and Sports Minister Hannah Yeoh, through its co-founder and CEO Ramachandran Muniandy, who is her husband.

In light of these events, the Center to Combat Cronyism and Corruption (C4 Center) is extremely concerned with the potential conflicts of interest in the appointment and the lack of transparency regarding the appointment process.

In response to public outcry, MACC chief commissioner Azam Baki stated that there was “no issue” with the appointment as Yeoh’s ministry had no direct ties to the Selangor state government.

C4 Center is dismayed that the head of the country’s primary anti-graft body could have such a dismissive view on a matter that raises serious questions of misgovernance and conflict of interest.

MACC chief commissioner Azam Baki

Regardless of whether the Youth and Sports Ministry is involved, the fact remains that Yeoh holds a position as a prominent figure within the DAP - and by extension Pakatan Harapan.

The simple fact that the same coalition forms the Selangor state government is enough to raise valid suspicions about the propriety of the appointment.

Therefore, while Azam argues that formal bureaucratic channels may not be directly linked in this matter, other political connections exist. These connections are enough to raise serious questions of conflict of interest, which remain unaddressed despite its grave implications for good governance.

The matter is compounded by the fact that there was no open tender - the state government and any individuals involved in this process should have acknowledged the possibility of a conflict of this magnitude occurring, with necessary measures taken to reduce the likelihood and perception of abuse.

No list of criteria

From reports, it is known that only two companies were considered for the appointment – Asia Mobiliti, and Badan Bas Sdn Bhd (Badan Bas). Notably, Badan Bas primarily has experience in the manufacturing and assembly of buses.

Rather than being cognisant of this perception, Asia Mobiliti, through its statement released on May 27, disregarded the need for an open tender process - claiming it would cause “a monopoly in the state”. C4 Center disagrees vehemently with this argument.

By its very nature, an open tender process encourages competition and openness in the procurement process and forms part of the United Nations Commission on International Trade Law (UNCITRAL) Model Law for public procurement.

Despite mentioning approval from the Land Public Transport Agency (Apad) in appointing Asia Mobiliti for the project, Ng has, thus far, failed to furnish any details pertaining to the list of criteria relevant to this approval.

Selangor state executive councillor Ng Sze Han

Why were no criteria disclosed publicly, especially in a situation as contentious as this? The opaqueness of the appointment procedure has only allowed aspersions to be cast regarding this matter.

This runs counter to Harapan’s explicit commitment to a more transparent public procurement system – pledged in both their “2022 Kita Boleh” manifesto and by Prime Minister Anwar Ibrahim, who as recently as last week reiterated the need for an open tender system.

Instances such as this only add to the litany of reasons to expedite the legislation of the Government Procurement Act, alongside strong procurement regulations at the state level.

Though the federal government has shown a willingness to enact this piece of legislation, the recent saga has laid bare the glaring need for any proposed law to be enforced in a manner that is effective in both federal and state governments.

Legal framework needed

This case underlies the crucial need for a mechanism for grievances and remedies in the procurement process. Without a clear grievance procedure in the procurement system, cases such as this will continue to raise suspicions of conflict of interest.

Most evidently, however, this saga has exposed the need for Malaysia to consider a legal framework to regulate conflicts of interest.

In doing so, a clearly defined scope must be established to clarify what exactly constitutes a conflict of interest, with stipulations that restrict or outright prohibit actors with contentious relations to the dealings.

There must then be full disclosure provided to the public for any proceedings flagged as having conflicts, allowing for better transparency, and easing future investigations.

Ultimately, the persistence of questions surrounding the awarding of government contracts - especially due to a lack of transparency from the government - will further dampen the credibility of the Madani government.

From the questionable granting of a discharge not amounting to an acquittal for Ahmad Zahid Hamidi’s various corruption cases to the shortening of Najib Abdul Razak’s prison sentence, confidence in Anwar’s calls to eradicate corruption is diminishing at a rapid rate.

C4 Center urges the government to take immediate action to remedy this trust deficit and ensure that its stated goal of overcoming corruption can be achieved.

Hence, C4 Center strongly urges that:

• The Selangor state government makes available the details of Asia Mobiliti’s appointment in full and commits to making all procurement-related information publicly accessible.

• The MACC conducts a comprehensive probe on this issue for any potential instances of abuse of power or undue influence.

• The federal government accelerates the enactment of a Government Procurement Act, in line with international standards such as the UNCITRAL’s Model Law on public procurement. Respective state governments must also ensure that state-level procurement is regulated transparently.

• All public procurement laws must include provisions for a grievance mechanism to remedy contracts that may be tainted with abuse of power or conflict of interest.

• Studies must be conducted to introduce a legal framework for regulating conflict of interest as part of a Code of Ethics for ministers, MPs and state assemblypersons, as well as their family members and associates. - Mkini