KUALA LUMPUR: The Home Ministry's failure to finalise the contract for the Foreign Workers Centralised Management System (FWCMS) led to legal action by Bestinet Sdn Bhd which filed a lawsuit seeking damages of RM1.57bil, says the Public Accounts Committee (PAC).
PAC chairman Datuk Mas Ermieyati Samsudin (pic) in a report to Parliament on Thursday (March 6) said the committee found that the main terms of the contract, including the payment structure, were not finalised despite the Home Ministry issuing a letter of acceptance in 2018.
"The Home Ministry failed to finalise the agreement on the fee that should have been charged beginning April 1, 2018, until the end of the contract on May 31, 2024.
"The failure of the government to respect the signed letter of acceptance has exposed the government to legal action by Bestinet that is demanding RM1.57bil," said Mas in a statement on Thursday (May 6).
According to Mas Ermieyati, Bestinet's RM1.57bil demand was calculated on a RM1.32bil loss of income plus interest worth RM252mil from April 1, 2018 until May 31, 2024.
As a result, she said Bestinet submitted a new demand of RM230 per worker, leading to negotiations where the government agreed to a rate of RM215 per worker, double the RM100 rate in the original agreement.
Mas Ermieyati also said the agreement included a six-year contract extension until Jan 31, 2031.
"Based on the signed agreement on Sept 3 last year, the RM215 charge is based on the RM130 needed (by the company) to recover from 2018 to 2024 and RM85 for operating costs from 2025 to 2031, including equity costs and operating costs," she added.
She urged the Home Ministry to explain the mechanisms in fee collections, the payment methods for Bestinet and also its best practices in optimising FWCMS until 2031.
"The Home Ministry must also improve its cyber security measures on FWCMS since this system is managed by the Bestinet," added Mas Ermieyati.
In November last year, the PAC unanimously decided to initiate proceedings on the procurement of the FWCMS by the Home Ministry.
The FWCMS has been used since 2013 as a platform to monitor and consolidate visa applications from 15 countries (including Bangladesh) exporting labour to Malaysia.
