KUALA LUMPUR: Four companies under the Ministry of Finance (Incorporated) (MOF Inc) were in the red for the financial year 2023.
The four companies that reported losses were Prasarana Malaysia Bhd, Mass Rapid Transit Corporation Sdn Bhd (now Malaysia Rapid Transit), Keretapi Tanah Melayu Bhd (KTMB) and Jambatan Kedua Sdn Bhd (JKSB).
The Finance Ministry said these companies were involved in implementing public infrastructure projects, particularly rail transport and bridge infrastructure.
“The losses were incurred to support the provision of services for the public’s convenience, such as through maintaining affordable fare rates,” it said in a parliamentary written reply dated Aug 25.
The ministry said government-linked companies (GLCs) under the MOF Inc are not established for profit-oriented purposes, but to fulfil specific objectives based on mandates set by the government.
This includes providing services and fulfilling social obligations to the public, such as public transportation or infrastructure services, bus, rail, water supply, electricity and sewerage services, and promoting economic development by supporting the creation of new industries, especially those that require large initial capital investments.
These companies are also tasked with promoting technological advancement through research and development (R&D) activities and attracting local and foreign investors to invest in high-value sectors such as artificial intelligence (AI), nanotechnology and information technology; filling market gaps that are not ventured into by the private sector; and maintaining government interests in strategic sectors.
It also said Bank Pembangunan Malaysia Bhd (BPMB), Pengurusan Aset Air Bhd (PAAB), Bank Pertanian Malaysia Bhd (Agrobank), IJN Holdings Sdn Bhd and Sirim Bhd were among the profitable companies under MOF Inc.
“As the majority shareholder, MOF Inc continuously strives to strengthen oversight of these companies’ financial and governance performance to ensure that the operations of MOF Inc companies are aligned with their founding objectives and government mandates,” it said.
The measures taken by MOF Inc include requiring presentation of companies’ annual business plans; setting Key Performance Indicators (KPIs) and reporting quarterly KPI performance and audit reports.
“In addition, MOF Inc has also taken the initiative to hold Corporate Improvement Programme (CIP) meetings for MOF Inc companies that fail to achieve at least 80% of their KPI targets in the current year.
“These CIP meetings are aimed at identifying issues faced by the companies and discussing structural improvements,” it said.
MOF Inc companies that fail to meet their KPI targets are also required to submit detailed explanations and an action plan outlining the steps the company will take to improve their performance and financial position,” it added.
The ministry was responding to a question by Lim Lip Eng (PH-Kepong) on the 20 GLCs that reported the highest losses, as well as the measures taken by the government to address the losses.
