Seek alternatives to Bernas in stablising rice prices: PAC

KUALA LUMPUR: The Public Accounts Committee (PAC) has urged the government to seek alternatives to Padiberas Nasional Berhad (Bernas) to maintain stability in the national rice industry and ensure a level field for all players in the market.

Its comments come amid concerns over the security of the staple grain. However, PAC said Bernas’ concession agreement was good and benefited padi farmers.

The current concession agreement is for the period 2021 to 2031 and is said to be in line with Bernas’ social obligations.

However, the question of seeking alternatives to Bernas is not new. In 2018, then agriculture and agro-based industry minister Datuk Seri Salahuddin Ayub said the government had no plans to close down Bernas but merely reduce its monopoly, adding that the government planned to issue the same licence to supply rice to several other firms.

“We are not trying to do away with Bernas. But as time goes by, we see there are problems and the need to break the monopoly enjoyed by Bernas,” Salahuddin had said.

On June 14 this year, PAC held proceedings at which Bernas division chief Abdul Rahman Mohd Nasri, rice control chief director Datuk Azman Mahmood and Agriculture and Food Security Ministry chief secretary Datuk Lokman Hakim Ali provided statements.

PAC said reducing the government’s reliance on the concession mechanism would push the industry towards an open market, the effect of which would be more competitive rice prices for Malaysians.

Lokman said in the ministry’s view, the role of stabilising rice prices is “a role for the government and not placed on the consideration of companies or concession holders”.

“That is why in the latest concession agreement, we made improvements by looking at the real objective, in which the government should fully play the role of stabilising rice prices in the market, as it not only involves this ministry but also other ministries.”

Lokman made his comments in light of the removal of “stabilising market prices of rice” as a social obligation in the latest Bernas concession agreement, which was first signed in 1996 and ended in 2011.

The latest agreement was extended from January 2021 to January 2031 and cost RM3.216 billion.

While Bernas is responsible for managing the padi subsidy scheme payments and is the sole importer of rice in the country, the company also has to fulfil several social obligations maintained in the agreement.

These include acting as the buyer of last resort for local rice supply, providing funds for padi mechanisation and equipment supply, fertilisation and large-scale padi development.

The PAC report also pointed out that as of June 14, Bernas has failed to allocate RM25 million out of the RM37 million funds provided in 2021 for social obligations.

“The ministry must ensure Bernas channel the obligation funds on time, in line with the Bernas concession agreement. The ministry, Bernas and the National Registration Department must immediately integrate and update padi farmers to ensure payment of the padi price subsidy scheme can be conducted transparently, efficiently and orderly,” PAC said.

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