KUALA LUMPUR (Nov 21): The extended six-year contract signed between the government and Bestinet Sdn Bhd for the Foreign Worker Centralised Management System (FWCMS) could cost the government a minimum of RM3.2 billion, according to a report by the Public Accounts Committee (PAC).
In the latest report released by the parliamentary watchdog on Thursday, the contract was finalised on Sept 3, following Cabinet approval on Aug 14.
The contract, effective from June 1, 2024 and running until Jan 31, 2031, increases the government’s payment to Bestinet for each issuance of an online temporary work permit , or better known as ePass, more than double to RM215 from the previous rate of RM100.
With a ceiling of 2.5 million foreign workers under the employment quota, the PAC estimates the government will pay a minimum of RM3.22 billion over the six years. This amount is double Bestinet’s original RM1.572 billion claim, which the company stated reflected losses incurred from operating the FWCMS between 2018 and May 31, 2024.
To recap, the PAC in July criticised the government for operating the foreign worker recruitment platform without a finalised contract for six years, despite a letter of acceptance being issued on January 12, 2018.
The PAC attributed the delay to breaches of procurement procedures, public-private partnership rules, and Bestinet’s request to increase collection charges from RM100 to RM120.
Higher charges justified to avoid legal dispute
In the report, a Home Ministry officer explained that the government approved the higher charges to avoid a legal dispute over Bestinet’s RM1.572 billion claim.
“The company’s claim was based on the argument that it was not allowed to collect charges during the contract period from 2018 to May 31, 2024,” said Hebat Hisham Mohd Yusoff, Deputy Divisional Secretary of the Immigration Affairs Division, in one of the PAC proceedings.
“We also consulted the Attorney-General’s Chambers (AGC), which opined that the company had a strong and well-founded case. To reach a middle ground, we agreed to a service charge of RM215 for each PLKS or ePass issued.”
However, the Home Ministry’s Secretary-General, Datuk Awang Alik Jeman, was quoted as saying the latest contract specifies that the payment is a one-off, covering biomedical costs.
The contract also grants exclusive rights for ePass issuance and renewal for the first year, and includes the withdrawal of Bestinet’s RM1.65 billion claim, Awang noted.
Awang Alik added that the government plans to integrate the FWCMS into the National Integrated Immigration System (NIISe), and once NIISe is fully operational, foreign worker management will be handled through this system after the FWCMS contract expires.
PAC flags concerns over too 'favorable' terms
The PAC flagged the extended contract as “overly favorable” to Bestinet in terms of government payments and contract duration.
The committee criticised the RM215 per ePass charge as excessive — more than double the original RM100 rate and significantly higher than the RM86 approved by the Public-Private Partnership Unit (UKAS) or the RM120 previously claimed by the company.
“PAC is very disappointed with an agreement initially claimed to be ‘at no cost to the government,’ which ultimately resulted in the government bearing a high cost for six years,” the report read.