KUALA LUMPUR: The government must avoid dependence on the Bernas concession agreement and find a new alternative to ensure stability in the nation’s rice industry, says the Public Accounts Committee (PAC).
By taking a different approach, the committee said Putrajaya could create an open market for the rice industry. This method would allow a level playing field for all market players.
The PAC said this in its report on the Receipt and Payment under Social Obligations of Concession Agreement for the National Padi and Rice Industry Management published on the Parliament’s official website on Wednesday (Oct 11).
The Bernas concession agreement, which began in 1996 and ended in 2011, was extended to 2031. The third concession agreement's cost, from January 2021 until January 2031, stands at RM3.216bil, according to the report.
The PAC said the Agriculture and Food Security Ministry must ensure that Bernas channels its obligatory funds on time, in line with the concession agreement.
“Until June 14, 2023, Bernas has not channelled the remaining RM25mil of the RM37mil for its 2021 social obligations fund.
“The padi price subsidy scheme updating was not monitored by the ministry. The result was RM730,000 to 300 dead rice farmers had to be managed
“The ministry must monitor the Bernas social obligation fund trust account to ensure all distribution and use of the funds are in accordance with the conditions stipulated in the concession agreement and trust deed.”
The PAC added that the ministry must demand relevant penalties for the concession company's failure to comply with its obligations in accordance with the concession agreement.
“This includes and is not limited to the failure to pay the RM25mil social obligation fund within the stipulated time period.”
The committee also suggested the ministry and Bernas provide a joint KPI performance report that is more accurate, transparent and realistic, based on actual farm management performance.
“The ministry and Bernas must ensure that the machinery and mechanisation are well maintained to enable it to be used by the padi farmers at any time,” the report added.
