The Auditor General exposed major flaws in Malaysian Army procurement systems through Report 2/2025. Parliament received findings about RM7.8 billion worth of armoured vehicle contracts that failed basic administrative standards. The military ordered GEMPITA, PENDEKAR, ADNAN, LIPAN BARA and MIFV vehicles to modernize defense capabilities. A local contractor delivered 68 GEMPITA vehicles late, triggering RM162.75 million in penalties that officials collected 746 days after contract expiration on December 31, 2022.
Government agencies paid RM7.52 billion despite missed deadlines while inadequate performance bonds totaled only RM53.93 million. Maintenance services for multiple vehicle types accumulated RM1.42 million in unpaid fines after 227-day delays. Military departments violated procurement rules by making small purchases worth RM107.54 million instead of using proper tender processes. Defense Ministry blamed pandemic restrictions, but auditors emphasized that penalty notices should have been issued during active contract periods to protect public funds.
Government agencies paid RM7.52 billion despite missed deadlines while inadequate performance bonds totaled only RM53.93 million. Maintenance services for multiple vehicle types accumulated RM1.42 million in unpaid fines after 227-day delays. Military departments violated procurement rules by making small purchases worth RM107.54 million instead of using proper tender processes. Defense Ministry blamed pandemic restrictions, but auditors emphasized that penalty notices should have been issued during active contract periods to protect public funds.
