Where have our taxes gone?

I was advised by my webmaster not to write this topic. As a blogger I might get into trouble involving ISA. However as a tax payee (income, road and government tax) if I didn’t voice this out I will probably regret for my whole life.

Question asked by The Star Paper on an article after the Auditor-General’s (AG) report was released:
Would you pay RM224 for a set of four screwdrivers?

We all know roughly how much a set of four screwdrivers would cost. If they are made in China it might cost RM20 only. OK, let’s not think of Chinese made screwdrivers. Let’s say they are made in Germany. How much would you think that will cost? Will RM100 be sufficient? If so, where has the balance of RM124 gone to?

Worse still, technical books which should cost only RM417 was sold to the Government for a whopping RM10,700! OMG, please tell me those books are coated with Gold or Platinum…

On the other hand, kudos to the AG on finding out all the procurement prices and a good pat to The Star which published this to the public. At least now we know what is happening to our money. However, that is still not good enough.

• Although we are somehow aware of the root cause, what are the action plans in place to prevent the same from happening again? So far we have yet to hear anything from the Government.
• Who are the culprits behind these and who will be explaining for this to the public?
• If the culprits were caught, are they going to return all the money to the public?
• Where is our opposition parties when we really need them?  

The news quoted from The Star (9-Sep-2007):
http://thestar.com.my/news/story.asp?file=/2007/9/9/nation/18832193&sec=nation

Paying through the nose for tools

By ROYCE CHEAH, ELIZABETH LOOI and MANJIT KAUR 

PETALING JAYA: Would you pay RM224 for a set of four screwdrivers? 

Probably not, but that was what the Government paid to supply tools for students at the eight National Youth Skills Institutes (IKBN) around the country, according to the Auditor-General’s (AG) report. 

The Star shopped around and found this set of Stanley screwdrivers. They cost RM32.80. For the RM224.94 set.

The AG said the screwdrivers had a market price of RM40 and according to pictures in the report, resembled the average Philips screwdrivers you could buy in any hardware shop. 

And it does not stop there – the AG went a step further by examining the prices paid for 12 other tools and equipment bought for the IKBN project, comparing it with market prices when the procurement was done in late 2002. 

Among these were technical books consisting 10 titles that had a price tag of RM10,700 and a 3.1 megapixel digital camera that was bought for RM8,254. 

  For the 13 items that the report highlighted, the Government paid RM8.39mil more than the market price at that time. 

According to the report, consultants for the Youth and Sports Ministry had reached an estimated price tag of RM399.67mil for the equipment for the IKBN project which later ballooned to RM767.98mil after two appeals by the ministry for additional allocations. 

“The ministry said more money was needed in anticipation of a bigger student population and that getting equipment from the same supplier meant prices would remain the same. 

“But there was no proof that market research was done to identify the prices of the items and equipment because minutes for the negotiation meetings were not prepared,” the report said. 

It said without the minutes, the auditing team was unable to find out if efforts were made to reduce prices. 

The AG also said that the ministry’s secretary-general (KSU) had signed off 11 contracts worth between RM7.99mil and RM74.2mil that were related to the IKBN project, on behalf of the Government. 

  “The KSU only has the authority to sign contracts worth less than RM5mil. Anything larger should be signed by the minister or someone to whom the authority has been given. 

“However, during the audit, no such letter giving the authority to the KSU presented itself,” the report said. 

The report said there were also discrepancies such as one supplier being paid more than the other for exactly the same equipment. 

One example the AG highlighted showed one supplier getting RM1.24mil more than the other for identical engineering equipment.