THE Public Accounts Committee (PAC) has urged the government to amend its supplementary agreement with Spanco Sdn Bhd to prevent ministries from paying lease charges on vehicles whose lease periods have expired but remain in use due to delays in receiving replacement vehicles.
PAC chairman Datuk Mas Ermieyati Samsudin (pic) said the committee recommended that the Finance Ministry incorporate the improvements into its supplementary agreement with the concessionaire to address weaknesses exposed by repeated delivery delays.
She said this at a press conference after tabling the PAC report yesterday.
The PAC also urged the ministry to review the current 60-working-day vehicle delivery requirement to better reflect industry realities, including changes in vehicle specifications, customs clearance, registration procedures, installation of specialised equipment and logistical challenges in Sabah and Sarawak.
It further recommended the full implementation of a digital fleet monitoring system across ministries and agencies to provide early warnings before vehicle leases expire, enabling replacement orders to be made on time.
“The committee also urged the ministry to expedite audits and verification of delivery delay data so that penalty claims against the concessionaire can be issued without further delay,” it said.
The PAC also recommended that the Finance Ministry and the Public-Private Partnership Unit conduct a comprehensive study on alternative fleet management models, including a multi-supplier system, to determine whether they would offer better cost efficiency and service delivery than the current single-concession model, which runs until 2037.
The recommendations followed findings in the Auditor-General’s Report 3/2025, which concluded that the government’s concession vehicle management was unsatisfactory due to delays in vehicle deliveries by Spanco, the failure to impose penalties for those delays and additional costs arising from the continued use of vehicles with expired leases.
“Poor communication between the ministry and user agencies, confusion over when delivery penalties should take effect and the failure to distribute contract documents delayed the government’s efforts to recover millions of ringgit in penalties from Spanco,” the committee said.
The PAC also found that delays in replacing 5,323 leased vehicles resulted in RM28.79mil in unnecessary expenditure, as ministries continued paying monthly lease charges and higher maintenance costs for ageing vehicles instead of operating newer units with lower upkeep costs.
