KUALA LUMPUR: The Human Resources Ministry and the Human Resources Development Corporation (HRD Corp) have been urged to re-evaluate the definition of unutilised levy to provide greater clarity and prevent the potential misuse of funds.
This recommendation was among those made by the Public Accounts Committee (PAC) following its review of HRD Corp's standard operating procedure (SOP) on unutilised levies.
"The PAC remains of the view that categorising unused levies within a two-year period as unutilised is too short a timeframe and does not adequately protect the interests of SMEs.
"Therefore, the ministry and HRD Corp must re-evaluate the definition of unutilised levy to ensure it is clearly defined and to prevent the funds from being used for purposes other than their original intent," the report said.
PAC in its report also said that HRD Corp, through its board of directors, should demonstrate greater commitment in reviewing the two-year timeframe to better safeguard the interests of SMEs.
"Additionally, the ministry and the HRD Corp board of directors must ensure that levies categorised as unutilised are utilised in accordance with the specified objectives and provide tangible benefits to the targeted groups."
In July, the PAC revealed that HRD Corp had used RM3.77 billion in levies collected from employers for training development programmes to make several different investments.
Investments made by HRD Corp were reported to have a market value of RM3.84 billion as of March this year.
PAC chairman Datuk Mas Ermieyati Samsuddin disclosed that the levy collected by HRD Corp had significantly increased, from RM475 million in 2020 to RM2.134 billion in 2023.
During its proceedings, the PAC was informed that levies unused by employers within two years are categorised as unutilised levies.
Following this, the PAC recommended that HRD Corp review the process of transferring levies to the unutilised levy fund to ensure the interests of small and medium enterprises (SMEs) are fully protected.