Federal Land Development Authority (Felda) lost millions due to poor planning and execution of projects says Auditor-General Report 2015.

KUALA LUMPUR: The Federal Land Development Authority (Felda) lost millions due to poor planning and execution of projects such as procurement of the Light Detection and Ranging (LiDAR) data collection services, implementation of a broadband project and three other ventures.

The second series of the Auditor-General’s Report 2015 released here today said the audit carried out between January and June this year, revealed the planning, implementation, monitoring and management of projects by Felda and its subsidiaries were unsatisfactory, while not meeting the stipulated objectives.

Among others, it said 65 contracts for the procurement of LiDAR services worth RM148.42 million, were signed by the Director of the Department of Land Management without proper authorisation.

In addition, the terms of all contracts signed by Felda with Bumitouch Sdn Bhd and Skyline Access Sdn Bhd for the LiDAR services were incomplete, and important clauses not included to safeguard its interest.

The report stated that the full payment of RM40.57 million for 53 out of 64 contracts with Bumitouch Sdn Bhd were made, although the deliverables of LiDAR were not fully received.

It said the LiDAR data collection by Bumitouch from 2013 to 2015 was already carried out.

However, the use of LiDAR technology for the purpose of replanting could not commence, as the deliverables for the period October 2013 to May 2015 for the related areas, was not fully received.

As for the implementation of the Broadband Project which cost RM566 million, the report said it was only completed up to the preparation of blueprint worth RM40 million.

"The pilot and full roll-out project had been suspended since Jan 29, 2015," said the report.

It also said that there was no feasibility study and due diligence undertaken by Felda prior to the Sturgeon Fish Farming, Savaro Restaurant and Schneeballen Pastries projects, to determine need and location, technological capabilities, leading the agency to suffer a RM73.63 million loss.

"There was also no approval from the relevant Minister and Finance Minister for the establisment of four subsidiary and sub-subsidiary companies on the implementation of the Sturgeon Fish Farming, Savaro Restaurant and Schneeballen Pastries projects," it said.

FELDA Caviartive Sdn Bhd spent RM47.62 million, but the returns including the sturgeon farming and technology transfer were not yet received, due to projects suspension.

"Global Settlers Sdn Bhd spent RM8.4 million for the opening of five Savaro Restaurants, but, all ceased operations after two to three years," the report highlighted.

It said the Schneeballen Pastry project was terminated in October 2015 and a RM6.39 million spent for the payment of the contract and pastry machines.

The AG recommended that Felda plan its procurement and management of projects comprehensively to ensure proper implementation and avoid wastage.

The statutory body was also asked to carry out feasibility studies and due diligence before participating in any investment and project.

It also stressed that Felda should take disciplinary action or surcharge officers responsible for any action which violated regulations and laws.--BERNAMA