The defence ministry is establishing a system to monitor its contracts and projects, following the disclosure that the army failed to collect RM162.75 million in penalties for the late delivery of armoured vehicles.
Deputy defence minister Adly Zahari said this system would improve efficiency and transparency in managing and procuring defence assets, and allow for earlier action to be taken on project delays.
Under the current procurement system, he said, penalties for delays would only be imposed when extension of time applications had been considered, Bernama reported.
“We acknowledge the weakness in enforcing contract terms, so we are in the process of developing a contract monitoring system to assist officers in tracking contracts,” Bernama quoted him as saying in the Dewan Rakyat.
The 2025 Auditor-General’s Report found that the army failed to collect RM162.75 million in penalties from a defence contractor that delivered armoured vehicles late under five contracts signed from 2011 to 2014.
In addition, penalties totalling RM1.42 million for delays in repair work and spare part deliveries between 2020 and 2023 were never imposed.
