TDA leads RM7 billion in PBC across agencies

The Technology Depository Agency Bhd (TDA), an agency under the Ministry of Finance Malaysia, has marked significant progress in its Performance-Based Contracting (PBC) efforts, with more than 86 agreements across government agencies now worth a combined more than RM7 billion contracts value.

This reflects Malaysia’s growing push to make government spending more accountable. As of August 2025, these contracts have either been executed or are ongoing, involving several key ministries and agencies. These include the Ministry of Finance, Ministry of Defence consisting of: Royal Malaysian Navy, Royal Malaysian Army & Royal Malaysian Airforce, Royal Malaysian Police, Immigration Department, Ministry of Homes Affairs and Malaysian Maritime Enforcement Agencies.

Workshop highlights success in government procurement

The achievement is a testament to TDA’s success in the implementation of PBC in government procurement. This was highlighted at the Malaysian PBC Practitioner Workshop 2025, where stakeholders from across ministries and  agencies gathered to experience and strengthen cooperation.

PBC is a method where the contractor’s payment is directly tied to the achievement of agreed-upon outcomes, with rewards for achieving targets and remedies for underperformance.

Under PBC, contracts are no longer about ticking boxes. Payments are tied to delivery of specific outcomes, not routine paperwork anymore. Instead of simply meeting basic requirements, contractors must deliver on agreed service and efficiency targets, ensuring public funds are spent on real results.

“This shows how far we’ve come in moving government contracts from process-driven to performance-driven. By embracing PBC, agencies are showing their commitment to ensuring every ringgit spent brings value to the rakyat,“ said TDA Chief Executive Officer, Dr Sharoul Jambari. 

Malaysia raises bar with performance-driven contracts

Introduced in July 2022, the PBC method is compulsory for maintenance, repair and overhaul contracts worth more than RM25 million. The approach has long been practised in the US, Europe, and Australia, and Malaysia’s steady adoption shows the country is raising the bar in performance-driven procurement.

The workshop provided the government bodies an opportunity to share experiences, identify challenges and provide feedback that will help refine future policies under the Ministry of Finance. It also reinforced the importance of inter-agency collaboration, to ensure the contracts deliver both efficiency and long-term benefits for the public.

Additionally, it sharpened policy recommendations, improved agency readiness, and strengthened ties between ministries – while reaffirming TDA’s role as a PBC centre of reference (PBC COR) for all performance-related matters, both contractual and non-contractual.

With more than 86 contracts already in motion, TDA and its stakeholders are looking ahead to the next phase, embedding performance-based practices across more sectors and strengthening public trust in how government spending is managed.