Tabung Haji Act amendments to introduce tougher financial reporting rules, penalties

KUALA LUMPUR, Aug 11 — The Tabung Haji (TH) Act 1995 will undergo proposed amendments to introduce stricter financial reporting rules, penalties, and clearer provisions in response to recommendations made by the Royal Commission of Inquiry (RCI). Prime Minister's Department Minister Zulkifli Hasan stated that these changes aim to prevent the recurrence of issues identified by the RCI during its investigation of TH's management and operations from 2014 to 2020.

The amendments will incorporate the RCI's suggestions, including the adoption of prescribed accounting standards and penalties for misreporting financial statements. A task force, chaired by the TH chairman and consisting of representatives from Bank Negara Malaysia (BNM) and the Securities Commission (SC), has been formed to examine the matter.

The task force has agreed to recommend that TH's fund management and investment activities be overseen by the SC, while haj management will continue to be under the supervision of the Prime Minister's Department for Religious Affairs. The RCI also urged the termination of the practice of awarding excessively high bonuses to staff, a practice TH has since discontinued in favor of a more measured bonus policy tied to the institution's financial performance and key performance indicators.

TH has been adhering to audited annual financial statements since 2022, aligning with the RCI's call for clearer provisions governing profit distribution calculations. The TH Act 1995 has undergone a comprehensive review, incorporating specific eligibility criteria and expertise-based selection procedures for board members, as well as prohibiting active politicians from serving as chairmen or board members.

TH's leadership appointments, including board members and management, have been based on integrity, capability, and experience under "fit and proper" criteria aligned with BNM's framework. The institution is now perceived as strong in terms of haj management, investments, finances, and overall operations.