PETALING JAYA: Forfeiting employers’ Human Resources Development Corporations (HRD Corp) levy contributions, if not used within two years, does not protect the interests of small and medium enterprises (SMEs), says the Public Accounts Committee (PAC).
In the PAC follow-up report, the committee said that the Human Resources Ministry and HRD Corp should redefine the term “unutilised levy” to prevent the misuse of pooled funds.
“PAC still believes that categorising levies that are not used within a two-year period as an unutilised levy is too short a timeframe and does not protect the interests of SMEs.
“Therefore, HRD Corp and/or through the HRD Corp Board of Directors are advised to be more committed to reviewing the two-year period to ensure the interests of SMEs are preserved.
“The Human Resources Ministry and the members of the HRD Corp Board of Directors should ensure that levies categorised as unutilised levy are truly used according to the established purposes and are beneficial to the target groups,” it said in the report released on Monday (Dec 9).
HRD Corp, in its feedback to the PAC on the recommendations to review the transfer method of levies to the unutilised levy funds, said that proactive measures had been taken to ensure the funds from the unutilised levies would be distributed to SMEs more efficiently.
It also said that it studied the alternatives for SMEs to use the employers’ contributions before being categorised as unutilised levies through stakeholder engagement.
As of September, HRD Corp said that it had conducted a total of 3,308 engagements to increase the participation of employers to enrol their employees in upskilling courses.
It added that this had resulted in a 32% increase in participation among employers with approved financial incentives of RM660.44mil (35% increase), compared to last year.
