PETALING JAYA: The investment panel of the Human Resource Development Corporation (HRD Corp) does not have a Bank Negara Malaysia representative as the central bank insisted on its exclusion.
Online news portal FMT reported that the central bank chose to remove its representative from the panel in 2010, despite Section 26(2)(e) of the Human Resource Development Act 2001 mandating the central bank's involvement.
However, a letter dated July 12, 2010, seen by FMT indicated that the withdrawal was not the result of any intentional action or oversight by HRD Corp.
In its letter to then HRD Corp chief executive officer Amirnuddin Mazlan, BNM stated that following the enactment of the Central Bank of Malaysia Act 2009, it had reevaluated the involvement of its officers on the boards and committees of external corporations.
"(The withdrawal of our representative) is in line with the objective of ensuring that the bank's mandate and responsibilities can be carried out effectively and after taking into account conflict of interest issues.
"Following this review, the bank has decided to discontinue the participation of its representative on (HRD Corp's) investment panel," read the letter signed by Nor Mashor, then secretary to the bank's board of directors, as quoted by FMT.
The letter supports testimony given by officials from the ministry and HRD Corp to the Public Accounts Committee (PAC) recently.
Human Resources Ministry legal adviser Shamsurryaty Shamsuddin, former HRD Corp chief operating officer Ariff Farhan Doss and HRD Corp senior legal officer Merle Fernandez told the PAC that BNM chose not to have a representative on the panel.
The PAC, in its report, recommended that the Human Resource Development Act be amended to remove the requirement for BNM to be represented on the panel.
Last week, the PAC, in its report, highlighted the absence of a representative from BNM on HRD Corp's investment panel since 2017, saying it was a violation of the law.
In a related development, Human Resources Minister Steven Sim refuted another claim in the PAC report that HRD Corp's investment panel had engaged in several "high-risk investments".
Sim told the Dewan Rakyat that 84 per cent of the RM3.77 billion invested by HRD Corp were in low-risk options, such as cash, deposits, bonds, sukuk and trust accounts, with the rest in equities.
Sim was also quoted by The Edge as saying that HRD Corp had recorded investment gains over the last four years — RM82 million in 2020, RM71 million in 2021, RM90 million in 2022 and RM176 million last year.
Sim said HRD Corp was well on course to achieving its investment target of RM180 million for the current year.
Up to June, HRD Corp had made investment gains of RM91 million, he added.