This article first appeared in The Edge Financial Daily on July 16, 2019

KUALA LUMPUR: The Malaysian Communications and Multimedia Commission (MCMC) spent RM12.81 million on special projects unrelated to its mandate of regulating the communications industry from 2016 to April 2018.

That is the finding of the Auditor-General’s Report 2018 Series 1 under the Activities of the Federal Ministries/Departments section.

From the RM12.81 million, among the more interesting expenses that deviated from the MCMC’s raison d’etre is RM104,679 for predictive analytics on the Sungai Besar by-election in 2016, which it spent based on a ministerial directive.

Recall that Barisan Nasional retained the Sungai Besar state assembly seat with a larger 2,289-vote majority. The by-election was held after the death of the incumbent, the late Tan Sri Noriah Kasnon, who won in 2013 with a slim 399-vote majority. Another MCMC expense incurred by a ministerial directive was the procurement of a big data analytics system called the MyInsight System, which cost the commission RM4.75 million. The system was procured on April 17, 2018, three weeks before the 14th general election on May 9, 2018.

The MCMC also spent RM100,000 as donation on behalf of the minister for 50,000 copies of then prime minister Datuk Seri Najib Razak’s book in February 2018, though the book title was not mentioned. These are among the findings from the National Audit Department’s review of 74 payments the MCMC made that were classified as “special projects” worth RM671.32 million.

In particular, the audit noted that project expenditures that involved channelling funds to other government agencies were done on the minister’s order. “Based on the feedback as at Jan 31, 2019, the MCMC is only involved in the fund allocation stage and did not monitor the implementation of these projects,” the audit added.

MCMC procedures also do not require special projects to be approved by the commission’s members.

Furthermore, the operating procedures and guidelines for channelling funds to third parties are not finalised. The reported added: “Audit checks on supporting documents for the purpose of payments found that for the minister’s corporate social responsibility (CSR) expenditure, the approval justifications were not stated clearly ... ”

In the MCMC’s response to the audit findings, which was included in the report, the commission said it had stopped all CSR funding for the minister and had not allocated further funds in its budget for this purpose.

“The payment related to the predictive analytics on the Sungai Besar election was done for the purpose of a special research through field work and online research on behalf of the minister of communications and multimedia as suggested by Unit Pengurusan Prestasi dan Pelaksanaan [in the] Prime Minister’s Department,” the MCMC explained.

As for the guidelines on channelling funds to third parties, the MCMC said it cancelled the draft following an order from the minister. The MCMC also said it had proposed to the ministry that the Malaysian Communications and Multimedia Commission Act 1998 be amended to revoke the minister’s powers to give instructions to the commission.

The MCMC said it will ensure all future expenditure is in line with its mandate and that it will take note of the audit findings moving forward.