M Santhananaban
Many of us will have read the full report of the remarkable Royal Commission of Inquiry into Tabung Haji.
The report gives a perceptive and professional account of Tabung Haji’s management and operations between 2014 and 2020 – while also placing its findings in the context of Tabung Haji’s longer history.
The royal commission carried out a genuinely commendable task without turning its report into a criminal judgment. Instead, it focused on Tabung Haji’s role, history, management and operations, including the functions and facilities it has provided since its establishment in 1963.
The report shows real respect for the fund’s mandate. But its main conclusion was clear: there are weaknesses in how Tabung Haji is run that need fixing.
Buried but telling
Buried in the report is a call for “fit and proper” people to run the fund.
That single phrase suggests a lot. It implies the fund was not always managed professionally or pragmatically. It also suggests that Tabung Haji did not maintain sufficient reserves and financial strength to protect its future.
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The board once included active politicians, including a couple of MPs, during part of the period under review. Senior officials from the Prime Minister’s Department and the Treasury also sat on it.
The report recommended that active politicians no longer serve as Tabung Haji’s chairman or board members, and that appointments be based on qualifications, experience and competence.
Yet the commission stayed fairly quiet on something fairly obvious: whether these senior officials properly carried out their fiduciary duties, and what allowances, prestige and perks they picked up along the way.
The report is more explicit about governance weaknesses and appointment procedures.
Echoes of Gomez
For more than a decade, Terence Gomez has written extensively about how our government-linked firms and investment companies are run, and their strengths and flaws.
This royal commission’s report echoes much of what he has argued.
It is worth restating a simple point. These government-linked companies and investment companies are not milch cows meant to top up the incomes of politicians, bureaucrats and retired civil servants. Nor should a statutory body be treated as a source of personal or political patronage.
Before anyone is appointed to the board of a government-linked company, investment company or statutory body, they should be properly assessed. Do they have a real sense of sacrifice? Are they sensitive to the nation’s aspirations? Do they have the courage to speak up when it matters?
These funds handle millions, often billions, of ringgit in public assets. The last thing they need is agreeable, self-seeking people who simply go along with whatever they are told.
A costly warning
This royal commission, chaired by former chief justice Raus Sharif, has laid bare how deeply these abuses became embedded in Tabung Haji, a statutory body established under the Tabung Haji Act 1995.
Had Tabung Haji collapsed, the government’s depositor guarantee alone could have been triggered. The report put the amount then covered at about RM88bn – a burden the economy could ill afford.
Malaysia cannot allow this kind of failure to happen again.
Dato’ M Santhananaban is a former Malaysian ambassador with over 45 years of public sector experience.
The views expressed in Aliran's media statements and the NGO statements we have endorsed reflect Aliran's official stand. Views and opinions expressed in other pieces published here do not necessarily reflect Aliran's official position.
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