Najib takes country into a leap of greater losses

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The economy drifts along listlessly in the face of scandalous losses suffered by GLCs while mismanagement, ‘leakages’ and the squandering of public funds have reached alarming levels, observes Martin Jalleh.

Source: votecharles.files.wordpress.com

Leakages, laggard government ministries and agencies, and scandalous losses and “looting” by the political elite marked Najib’s second year as PM.

Below are some examples:

• In May 2010, Pas proposed to file a suit against the Federal Government for ceding away the oil and gas-rich offshore Blocks L and M in South China Sea to Brunei to protect the rights of future generations of Sarawakians, Sabahans and Malaysians. Mahathir had estimated that the worth of oil and gas rights for both blocks are in the region of US$100 billion (RM320 billion).

• On 8 May 2010, Minister in the PM’s Department Nor Mohamed Yakcop confirmed that Pos Malaysia Bhd had incurred losses over the years amounting to RM546 million. He said he was “not directly involved (with the losses) because Pos Malaysia, as a government-linked company (GLC), has its board of directors and any decision is determined by the board, including Khazanah Nasional Bhd, without having to refer to the ministry of finance”.

• In an open letter dated 13 June, former Land and Co-Operative Development deputy minister Dr Tan Kee Kwong, who was put in charge of answering questions in Parliament regarding all Felda matters during his tenure, alleged that there was mismanagement and high-level government corruption in the organisation. He also accused Najib of “single handedly destroying Felda”!

“As of now out of the huge cash hoard of RM 4.5 Billion, only RM200 Million is left. In actual fact with the record price of CPO (crude palm oil) for the past few years, Felda, if managed properly, should have cash reserves of RM6 billion! The reverse has happened and now it has only a pathetic sum left.”

READ MORE:  White Paper on Felda confirms massive fraud: Time to charge the culprits

After his initial attempts to appease an angry PM and to do some damage control Ahmad Maslan, the deputy minister in the Prime Minister’s Department and in charge of Felda, admitted in parliament that Felda’s cash reserves had plunged to RM2.73 billion from RM4.08 billion in 2004 and five years later it dropped further to RM1.35 billion in 2009.

• In July 2010, it was revealed that Johor Corporation (JCorp), the most successful state corporation in the country was in debt amounting to RM3.58 billion. Its Chief Executive Officer Muhammad Ali Hashim denied his resignation was due to the company’s debt and added that JCorp’s asset value of RM12 billion, including RM6 billion in listed shares, is currently higher than the debt itself.

• On 29 July 2010, former Transport Minister Ling Liong Sik was charged in the Kajang Sessions Court over his involvement in the RM12.5 billion Port Klang Free Zone (PKFZ) scandal. PKFZ, a commercial and industrial project south of the capital, was conceived as a RM1.82 billion venture constructed over 1,000 acres. However, costs are expected to balloon to RM12.5 billion, making the affair one of the country’s biggest financial scandals and a major embarrassment for the government (Malaysiakini).

• On 5 August 2010, the Malaysian Insider reported that the 100-year-old Sime Darby Berhad could face massive losses amounting to RM2 billion or as high as RM2.5 billion. Most of the losses are down to ill-advised investments in the energy and utilities sector in Qatar as well as tardy business practices in the development of the Bakun Dam in Sarawak.

• On 13 August 2010, Anwar urged Najib to come clean about further potential losses in the troubled Bakun Dam project. This is especially if the losses, said to amount to another RM2 billion following problematic federal-state negotiations, are to be absorbed by the rakyat already suffering from subsidy cuts. .

READ MORE:  White Paper on Felda confirms massive fraud: Time to charge the culprits

The total cost of the dam is reported to have ballooned to RM7.3 billion. Anwar also raised the alarm over the total RM5.75 billion in loans from the Employees Provident Fund (EPF) and Retirement Fund Incorporated (KWAP), which have largely funded the Bakun Dam project

“Who will pay for the losses? Will the prime minister instruct the EPF and KWAP to quietly write off a part of the RM5.75 billion in loans to Bakun Dam to hide the losses from the public?” (Malaysiakini)

• On 16 August 2010, DAP secretary-general Lim Guan Eng criticised the BN for failing to act against those he claimed stole RM52 billion worth of Bumiputera shares from poor Malays. Najib reportedly admitted in June 2008 that only RM2 billion out of the RM54 billion of Bumiputera shares given out since the inception of the New Economic Policy (NEP) in 1971 remained in the hands of the Malays.

• On 16 August 2010, it was made known that fuel price volatility led Malaysia Airlines (MAS) to post a pre-tax loss of RM533 million for the second quarter ending 30 June 2010 compared with a pre-tax profit of RM896 million in the same period in 2009. Its revenue, however, increased by 26 per cent to RM3.2 billion (compared to RM2.5 billion) while operating profit improved 33 per cent. For the first half ending 30 June 2010, the airline posted a pre-tax loss of RM212 million from a pre-tax profit of RM190 million.

• On 20 October 2010, Malacca Chief Minister Mohd Ali Rustam officially declared the historical state “a developed state”. Two weeks later, the Organisation for Economic Cooperation and Development (OECD) clarified that the OECD did not endorse the Malaccan declaration, mainly because they were not in a position to do so! Two months later, Malacca’s RM15.9mil new monorail, which the CM had launched on that “historic” day, was plagued by “several technical and mechanical problems”. Then in the month after its launch, the monorail only worked intermittently before more problems developed with its wheels and software system (Malaysian Chronicle).

READ MORE:  White Paper on Felda confirms massive fraud: Time to charge the culprits

• On 29 November 2010, opposition parliamentarian Khalid Samad (Pas-Shah Alam) moved a RM10 pay-cut motion against Works Minister Shaziman Abu Mansor for his minister’s inability to tackle delays, alleged discrepancies and allegations of Umno-linked cronyism in various mega-construction projects such as the:

Shah Alam Hospital project: Khalid questioned the whopping increase in the cost of the project (mooted about 10 years ago). It was initially estimated to cost taxpayers RM300 million but later ballooned to a staggering RM482 million– a mark-up of RM182 million. It was scheduled for completion on 14 August 2010, rescheduled for November 2010 but has now been extended to June 2011. After making many excuses, the minister said that the Public Works Department (PWD) was in the process of appointing a ‘white knight’ to rescue and complete the abandoned project by way of a limited tendering procurement method.

National Cancer Institute: The cost for this project (believed to be directly awarded to an unknown entity connected to the ruling elite) escalated from RM340 million when announced in 2007 to RM700 million in 2009.

New Palace: Khalid also sought to censure the minister for the exorbitant cost of RM935 million for the new palace which stood at RM811 million in June. The cost of the new palace doubled from its estimated RM400 million in 2006 and the contacts for the construction were awarded to three companies through direct negotiations, instead of open tenders. Well-placed sources in Kuala Lumpur told Asia Sentinel that the total cost is actually nearing RM1.2 billion and is expected to go higher.

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