On the 2nd of January 2022, the Malaysian Government launched the PADU system, its digitalised central database to collect key information on its citizens to enable the more effective delivery of fiscal support systems. Received with mix responses from the citizenry, the system represents an effort by the Government to more fairly and accurate provide social support to Malaysians. In this article, we review some of the main features of the PADU system, the benefits that it intends to bring to the citizenry, and some of the key challenges that have been identified as with regards to its implementation thus far.
What is PADU?
PADU or Pangkalan Data Utama, is the new Malaysian Central Database Hub that has been introduced by the local Government as a means to consolidate information on Malaysian citizens. The information is drawn from a broad range of sources and Government agencies, and requires that citizens register via an online portal. The system, which is managed by the Department of Statistics Malaysia, aims to create a digital storehouse of citizen’s information to support the Government in providing holistic data to implement targeted subsidies and the relevant social protection schemes.
What is the Purpose of PADU?
The Purpose of PADU is to prepare a central database hub for the country which consolidates social security information such as household income, expenditure and Government assistance, which can then be digitally analysed. The primary aim of the system is to allow the Government to identity citizens which are in need of fiscal support, as well as to prevent the instances of fraud with respect to subsidy requests from the public. The ultimate goal of PADU is to increase the efficiency of providing Government services as well as to solidify the use of the Government’s limited resources. In addition, the system aspires to strengthen the socio-economic dynamics of the citizenry and bridge the socio-economic gap, while balancing overall growth and development.
PMX Datuk Seri Anwar Ibrahim at the launch of PADU in January – Image Source: Malay Mail
How Does it Work?
Malaysian citizens aged 18 years and above are eligible to register to PADU through their online portal. To create a PADU account, the system requires that users enter their full name, MyKad number and postcode, ensuring that the detail match up with what is currently stated on their MyKad. Users are also required to provide their mobile phone number to enable the OTP (One-Time-Password) process. Once the OTP has been verified, a password will need to be entered and logged with the account.
PADU uses an OPT verification system to ensure user data is protected.
Next comes the second part of the registration, which involves the electronic Know Your Customer (eKYC) verification. This stage of the process is image based and requires that users simply snap a photo of the front and back of their MyKad, along with a clear profile picture of themselves. To being the e-KYC verification process, a QR code will need to be scanned once users have entered their passwords. On-screen instructions will then appear guiding users through the rest of the process until completion. The standard allotted time for the system to finalise user registration is 3 days, however it usually occurs much faster than this.
What are the Benefits of PADU?
As mentioned above, the main benefit of PADU is to strengthen the Governments ability to manage and oversee citizen-centric data in order to provide targeted social support.
Honing in more closely on this notion, perhaps the clearest benefit afforded by the PADU system lies within its ability to enable the delivery of targeted subsidies by the Government. Why exactly is the delivery of targeted subsidies so important, one might ask?
Simply put, subsidy targeting allows the Government to make better decisions about who among the citizenry should be should be entitled to financial assistance by analysing the relevant data in detail. A system such as PADU would allow the Government to quickly and accurately review large swaths of data on citizens in order to determine which households are most in need of support. This ensures that those who are most in need receive the necessary benefits.
Some of the key benefits that subsidy targeting can provide include:
Enabling better decision-making – By leveraging on the wide pool of citizenry data, such as household income jobs, education, income, spending and commitments, the Government can make more informed decisions with regards to distributing subsidies to those most in need of them.
Promoting greater inclusivity – Subsidy targeting allows the Government to include individuals who had previously been overlooked by Government assistance programs. This means that more people, regardless of their work or where they live, are able to access the support they need.
Allowing more efficient use of resources – By leveraging on data for subsidy targeting, the Government cane ensure that resources are more efficiently put to use. This means that assistance can be provided to a greater number of people without compromising on the quality of the support given.
Creating better access to welfare – The existence of centralised database makes it easier for individual citizens to access the welfare programs which are most relevant to their personal needs. By registering with the program once, they will have access to multiple welfare programs, without the need to identify and register for each.
What are Some of the Issues/Criticisms Surrounding PADU?
While many have acknowledged that the PADU system represents a dutiful effort by the Government to provide a greater level of support to the citizenry, concerns have also been raised as to the true effectiveness of the system from practical standpoint.
A Data Entry Exercise
Since the PADU system was activated by the Malaysian Government in January of 2024, users have reported several issues with regards to the usability of the system. Once such issue is that many of the database fields for which the Government should already have citizen-related information have been left blank, requiring that users re-enter this information which the system should already have access to. This has led users to question practical efficiency of the PADU system from the standpoint of user-friendliness.
Fraudulent Data Entry by Users
Another issue that has been raised by concerned citizens is with regards to instances of fraudulent data entry by users. The question as to what measures are in place to prevent a user from entering false information into the database has created some cause for concern. Additionally, should such individuals try to trick the system into entitled them to particular subsidies or benefits, what would the relevant repercussions by the Government be for identifying and handling such instances?
Fulfilling its Intended Purpose
Questions have also been raised as to whether the PADU system will in fact be able to achieve intended purpose, which is ultimately to properly identify citizens through data analysis who are entitled to the relevant social and financial support, and provide these to them in a targeted manner. It is unclear at this stage precisely how the Government will effectively leverage on the data provided to more fairly and accurately distribute such support to the citizens in need of them.
Providing Sensitive Data
One of the main issues that have been raised with respect to the PADU system surrounds the fact that it requires citizens to enter highly sensitive data regarding both their personal lives as well as their financial information. Concerned citizens have raised the point that putting the onus on citizens to enter such data themselves using an online portal may create unnecessary personal security and privacy risks. A more prudent approach may be to collect information from citizens directly the conventional in-person approach.
Data Security and Exposure to Corruption and Scams
Following from the previously mentioned issue, there are also concerns with respect to effective management of data privacy and security associated with the PADU system. For instance, it has been noted that the Data Privacy and Protection Act 2010 does not apply to the Government, which means that any exposure caused by the system would create legal complications with respect to accountability.
In response to this issue and to assuage public concerns, the Economy Minister, YB Rafizi Ramli, has stated that PADU, has been developed and is managed by civil servants, who are governed by the Official Secrets Act (The Star, 4th January 2024). However it is nevertheless daunting that such highly sensitive information is being shared with no clear notion whether or not it can be misused by maliciously intended parties.
Minister of Economy Rafizi Ramli at a PADU media event – Image Source: The Star
This issue is particularly concerning to citizens in light of the fact there has been a rampant rise in the number of fraudulent cases occurring in the country over the past few years. Frequent reports of scams and identity theft have caused serious and widespread financial loss to Malaysian citizens, with cases involving the impersonation of Inland Revenue Board officials, police officers, court officers, customs officials, and so on. In such instances, the perpetrators have been found to have had access to private citizenry information such as NRIC and bank account numbers, thus the question remains as to how such information is being accessed.
How can these challenges be addressed moving forwards?
Ensure Practicality and User-Friendliness of the System
Firstly, from an administrative perspective, the PADU system (web portal and digital application) should be both practically effective and user-friendly. This would require that system is free from errors and glitches, and that issue relating to redundancies (such as the need for citizens to re-enter information that should already be accessible) ought be removed. Essentially, the program’s digital features should provide a seamless experience that is consistently efficient and effective from a practical standpoint.
Users can check that they have filled in all the required data fields before submitting their registration.
Additionally, the system should be continually monitored and managed to ensure that it functions as intended, and that any user-experience related errors are addressed in a timely manner. It is also necessary to ensure that relevant online support representatives can be contacted in a timely and reliable manner.
Address Instances Involving the System’s Abuse
The Government should also ensure that the necessary measures and SOPs are put in place to manage instances of fraudulent data entry. Having a clear understanding of how such instances can be prevented and what procedures would be implemented for managing them is necessary and should be communicated to the public as transparently as possible.
Implement Effective Cybersecurity Measures
It is highly important that the necessary data security measures are put in place to effectively prevent data loss and theft. From the perspective of digital technology, this means that the Government would need to ensure that the most advanced and reliable cybersecurity measures are integrated into the system to ensure that personal information and the database itself is fully safeguarded from cybersecurity threats. The e-KYC system is one such approach, however it should be accurately assessed as to whether this is a sufficient enough measure. Private cybersecurity companies should be consulted to ensure that most appropriate and effective systems are put in place.
Implement Relevant and Effective Policy Measures
The Government should also ensure that the relevant legislative policies are put in place which provide effective responses to instances involving fraud or corruption. Key policies such as the Personal Data Protection Act 2010 should be reviewed and revised accordingly against the risks associated with the PADU system.
Conclusion
The PADU system appears to represent a deliberate and mindful effort by the Government to provide a system which better caters to the present and modern needs of its citizenry. Leveraging on data analytics technology to more accurately collect information on citizens with the intended purpose of delivering targeted welfare and support is indeed and admirable pursuit.
Nevertheless, as with all well-intended goals, the true measure of its effectiveness comes with its ability to consistently deliver on the expected outcomes in a reliable way. For the PADU system, this means functioning efficiently and effectively from a practical, day-to-day standpoint and putting the relevant citizens in touch with targeted social benefits, without compromising on their need for information privacy in the process.
Does PADU in fact deliver on its promise to provide a more seamless and user-friendly approach for collecting key information on its citizens? Are the necessary measures in place to ensure that Government can in fact leverage on that information to provide benefits to citizens who are most in need? And have the risks surrounding data security and fraudulent activity with regards to its utilization been fully appropriately addressed?
These are some of the issues that the government must contend with if it hopes to win the support of Malaysian citizens with respect to public initiatives such as PADU moving forwards.
