The report said the objective of the Merdeka Farm Project under the Kemubu Agricultural Development Board (Kada) was to alleviate poverty and make use of abandoned padi fields to boost the state’s padi production.

It started operating in 1992, with Kada tasked with planning, implementing, monitoring and evaluating the programme from the padi planting stage to the distribution of profits.

The operational costs of the project are covered in advance by Kada while the profits are distributed to land owners based on the percentage of their land ownership.

The funds are distributed through cash to the participants, unless they request for online transfers.

In its 2021 report on federal agencies, the audit department said the project was a good effort but there were weaknesses in the distribution of proceeds to participants.

“Those weaknesses that require attention include the distribution of padi proceeds amounting to RM4.36 million to representatives of participants who could not be verified.

“Additionally, padi proceeds amounting to RM471,996 were not distributed to Merdeka Farm Project participants at the end of the padi planting season,” it said in its report released today.

The department called for the project’s agreement between Kada and participants to be reviewed and for a comprehensive SOP to be drawn up, particularly for the distribution of proceeds and nomination of beneficiaries.

It also urged Kada to maintain a database of participants and closely monitor the distribution of proceeds, as well as for payments to be done online instead.