PETALING JAYA: The Works Ministry failed to recover RM90.50mil in utility relocation reimbursements for infrastructure projects, leading to inaccurate government financial statements and millions in uncollected public revenue, according to the Auditor-General’s Report Series 2/2026.
The report, tabled in Dewan Rakyat on Monday (Oct 5), attributed the failure to delays in billing, ongoing fee disputes with utility companies, and administrative errors, including misrecording RM30.46mil in government-funded projects as private debt.
“Out of the RM90.50mil in Accounts Receivable (AR) recorded as of Dec 31, 2025, RM84.05mil (92.8%) was overdue by more than 12 months,” the report stated.
“In addition, 22 utility relocation works totalling RM63.16mil across 11 projects have yet to be claimed, despite the six-month period following the issuance of the Certificate of Practical Completion (CPC) having lapsed."
The report warned that such lapses compromise the accuracy of government revenue reporting in the Federal Government Financial Statements and increase the risk of extended delays in recovering public funds.
To rectify these weaknesses, the report recommended that the ministry regularly review, verify, and update AR records against project files, enforce strict timeframes for claim submissions following CPC issuance, and pursue progressive negotiations and legal follow-ups with utility companies.
In response, the Works Ministry explained that reimbursement arrears stemmed from claim value disputes raised by utility firms and incomplete supporting documentation provided by the companies' appointed contractors.
The ministry added that contractor delays in finalising supporting documents, as-built drawings, and technical coordination reports were the main causes of delayed official claims.
It noted that the RM90.50mil outstanding balance has since been reduced by RM34.3mil (37.9%) to RM56.2mil.
This reduction includes RM3.8mil in collected reimbursements across six claims, alongside the removal of RM30.46mil across seven claims under the 10th Malaysia Plan (10MP) projects that were mistakenly listed as AR due to an internal documentation error.
The ministry stated it discovered the submission error during a review of its Dec 31, 2025 AR report and removed the affected claims in April 2026 to restore record accuracy.
