Answer for Written Question PT023

QUESTION

Yang Berhormat Awang Lau How Teck

YANG BERHORMAT AWANG LAU HOW TECK asked the MENTERI DI JABATAN PERDANA MENTERI DAN MENTERI KEWANGAN DAN EKONOMI II to state the Ministry’s assessment regarding delays in government payments and their impact on the cash flow of local enterprises. How can this matter be improved to avoid financial pressures that affect the sustainability of small and medium-sized businesses?

ANSWER

Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II

The Ministry of Finance and Economy is aware of delays in the payment process to some local enterprises, particularly small and medium-sized businesses, which have consequently resulted in pressure on their cash flow.

Generally, claims submitted by companies must comply with the requirements of the Financial Regulations. Where an application has been submitted completely and there are sufficient funds, insya Allah, it can be processed in accordance with the established TPOR, which is 30 days.

Based on this Ministry’s review, one of the main causes contributing to delays in the payment process is that the documents submitted are incomplete or not in order, such as invoices that do not bear the required verification chop as stipulated by the Financial Regulations. In this regard, Insha-Allah, the Ministry of Finance and Economy, through the Treasury Department, will introduce an initiative on 1 April 2026 to digitalise chop verification through an enhancement to the TAFIS 2.0 system. This initiative is intended to further expedite the payment process to small and medium-sized businesses.

Second, no work order (Purchase Order - PO) was issued for the purchase of goods or services that had been carried out. It must be emphasised that every Controlling Officer (normally the Permanent Secretary or Head of Department) is responsible for controlling and ensuring that purchases and payments made are based on the approved estimated allocation and comply with the Financial Regulations currently in force. For any purchase or payment that does not comply with the Financial Regulations, the officer responsible and the Controlling Officer may be subject to surcharge action.

Everyone is reminded that, in accordance with the Financial Regulations, for every purchase or work order to be carried out, the officer responsible must ensure that sufficient funds are available before making any expenditure commitment. If expenditure is incurred without sufficient funds being available, the officer concerned may be subject to surcharge action.

The Ministry of Finance and Economy, through the Treasury Department, remains committed to strengthening the TAFIS 2.0 system to ensure that payments to suppliers can be made more efficiently, transparently and systematically. Following a review by the Treasury Department, several initiatives have been undertaken to address this issue, such as:

First, establishing the Tekad Pemedulian Orang Ramai (TPOR) policy, which emphasises a 30-day payment period for suppliers as a commitment to ensuring smooth cash flow and fairness in the Government payment process. This mechanism is continuously monitored to ensure compliance by all Ministries and Departments.

Second, regularly updating the TAFIS 2.0 website or as required so that Ministries and Departments always have access to the latest information on TAFIS 2.0, such as Frequently Asked Questions (FAQ), a checklist for the payment process and a quick guide on the procedures for checking the status of Purchase Orders (POs) and payments.

Third, facilitating suppliers in checking payment status through the Government Vendor Portal (GVP). Through this improvement, which enhances transparency, suppliers can determine whether the payment is still under review by the Department, has been queried by the Department or is still awaiting final approval by the Treasury Department.

This approach can also reduce the need for suppliers to contact the Customer Service Centre (PPP), thereby improving service delivery efficiency.