2010 AG Report: Giatmara paid more than double for equipment (Update)

PETALING JAYA (Oct 24, 2011): Giatmara, a subsidiary of the Majlis Amanah Rakyat (Mara), purchased equipment for its skills-training programmes at more than double the market price, this year's Auditor-General's Report revealed.

Some RM18.2 million (37.1%) of its programme allocation, was spent on equipment such as sewing machines, ovens, mixers, foldable beds and blenders for between 71.9% and up to 200% above the market price.

Among the items, priced per unit, are:

>> an Elba EO-5086 oven with the actual market price of RM419, but was purchased at RM1,200,

>> a Trio TPM-1000 stand mixer was purchased at RM1,200 when its actual market price is RM698,

>> a RM100 foldable bed was bought at RM500,

>> a RM799 Cornell CSM-PH988S mixer which was purchased for RM1,560,

>> Toji International gas stoves at market price of RM59.90 but bought at RM200 per unit,

>> Hair clippers purchased at RM325 each when its actual price is RM165, and

>> Pensonic blenders bought at RM140 each when its actual price is RM60.

Giatmara's main objective is to conduct technical and non-technical skills programmes to help the poor gain a steady income.

However, the report found that the overall outcome of the programmes were less than satisfactory.

Almost half of 129 participants of Giatmara's short term income-generating courses (LMP) did not gain any income after the course, and only 44 participants managed to generate income between RM100 to RM3,000 a month.

The report also found that after spending RM1.22 million on 11 LMP courses in Sarawak, Perak and Kelantan, none of its participants generated any income due to unsuitability of the courses, no electricity supply, and no demand.

The report highlighted:

>> In Kapit, Sarawak, high-speed sewing machines and ovens were purchased at RM1,600 and RM1,560 respectively but cannot be used as there is no electricity supply

>> In Perak, meat grinders purchased at RM180 were unused as it was far easier for participants of the programme to buy fish feed from stores

Other findings in the report include:

>> more than 10% of the 140 participants surveyed were earning more than the poverty line of RM720. Some of its participants also held steady jobs in the civil service or were pensioners;

>> more than 70% of another 140 participants surveyed were not in the e-Kasih database (for the poor and hardcore poor), and almost 20% of these 140 did not have proper verification of their income status.

The report also found that the courses were not conducted efficiently due to a lack of standard operating procedures, there were no proper studies on suitability of courses and non-compliance to the guidelines and rules in procurement were not adhered to leading to the overspend.

The AG recommended that Giatmara conduct market research so that equipment is purchased at a reasonable price, and also for a proper standard operating procedure to be presented to the Giatmara board of directors.