KUALA LUMPUR: The National Audit Report (NAR) today recommended that the Federal Land Development Authorities (Felda) review or take over the role of its managing agent Felda Technoplant Sdn Bhd in its oil palm replanting programme after the audit found several unsatisfactory practices.
Among the recommendations of the audit report on federal statutory bodies tabled in the Dewan Rakyat today were that Felda and Felda Technoplant sign an agreement "to protect the interests of Felda".
The audit, conducted from September to October last year, found no agent appointment agreement signed between both parties to specify Felda Technoplant's scope of work, maintenance, land size and payment claims.
Felda Technoplant is a subsidiary of Felda Holdings Bhd, a holding company of which Felda holds 49% equity.
According to the report, the replanting programme had exceeded its approved allocations by RM312.65 million, after its actual spending totalled RM653.17 million compared with the approved allocations of RM340.52million.
Felda had informed auditors that the excess spending was attributed to increases in the cost of transportation, fertiliser, poison, seedlings and labour following the recent increase in oil prices, the report said.
The report, signed by Auditor-general Tan Sri Ambrin Buang, also recommended that Felda implement a more orderly plan to ensure that financial allocations were sufficient.
Auditors also found a non-integration of Felda and Felda Technoplant systems which resulted in an inability to align loan deduction and payments to settlers' accounts.
It added that there were delays caused by lack of human resource and expertise as well as the use of inappropriate equipment by subcontractors.
Felda also did not effectively monitor the work performed by sub-contractors appointed by Felda Technoplant, the report said.
From 2006 to the end of 2008, Felda had replanted 45,898 hectares of land belonging to 11,073 settlers at a cost of RM1.71 billion from 2006 to the end of 2008, the report said.
This was included in the total 218,000 hectares replanted, involving 53,430 smallholders up to June 2008.