“That this House expresses regret that the full report of the Public Accounts committee of the Fifth Dewan Rakyat on the 1977 Federal Government Accounts was only tabled on 15th October 1985;
“Further Notes that the Public Accounts Committee of the Sixth Dewan Rakyat has not presented a single Report together with the minutes of the proceedings yet to the Dewan Rakyat.
“Resolves to accept the full report of the Public Accounts Committee of the Fifth Dewan Rakyat on the 1977 Federal Government Accounts; but
“Directs the Public Accounts Committee of the Sixth Dewan Rakyat to complete and table all its reports on the Federal Government Accounts from 1978 onwards to the present Dewan Rakyat, as otherwise the Public Accounts committee would have lost its purpose should its reports be ready for the Seventh Dewan Rakyat”
Last week’s Parliamentary farce where the Dewan Rakyat was misled by a Cabinet Minister to violate the Standing Orders to improperly and irregularly cancel Parliamentary sittings on Thursday and Friday brought Parliament’s public standing, which was never very high, to a new low. As a result of the parliamentary farce, the Malaysian public was entitled to ask whether they could trust MPs to legislate for their future and that of the nation, when MPs and Ministers could not even understand their own Standing Orders. They are further entitled to wonder as to what they could expect from Parliament, when both Government and Parliament are so inefficient that Government Bills could get stuck with the Government Printers as to disrupt Parliamentary proceedings.
The subject of my motion today, the Parliamentary Accounts Committee, which is supposed to be the highest custodian of government public accountability, is also unlikely to raise Parliament’s esteem, standing and respect among Malaysians.
It is very sad that on the 25th Anniversary of Parliament, which we celebrated early this year, Parliament’s standing had never been so low, and instead of taking remedial measures through parliamentary reforms to give substance and meaning to Malaysia’s Parliament to regain public respect, we seem determined to perpetuate and expose Parliament’s inconsequence and irrelevance.
Clearly if MPs themselves do not take Parliament and their Parliamentary duties and responsibilities seriously, (otherwise there is no reason why with a four-fifth majority, the ruling Barisan Nasional could not even assure a parliamentary quorum), then no one have respect for Parliament in the country.
The report we are discussing today is the Report of the PAC of the Fifth parliament on the 1977 Federal Government Accounts. The Fifth Parliament was dissolved in March 1982, but out Parliamentary system is so ‘efficient’ that we are now hearing and debating the ‘voices of the dead’! By ‘dead’, I do not mean that the MPs of the Fifth Parliament are dead (for I myself was an MP in Fifth Parliament), but that the Fifth parliament had ceased to exist!
It is the Fifth Parliament itself which should have debated the report of its PAC, but then the full report of the Fifth parliament’s PAC on the 1977 Federal Government Accounts was not ready for tabling in Parliament until last week! Malaysia’s Parliament is most unique in the entire world, always setting precedents to expose our Parliamentary institution to new heights of ridicule and public contempt!
Another shocking piece of parliamentary sleight-of-hand is to attempt to disguise the ‘agedness’ of the PAC report. In the Order Paper of Wednesday, October 16, 1985, the Fifth Parliament’s full report on the 1977 Federal Government Accounts, was given the reference number of ‘DR. 4/1981’, although its date of tabling in Parliament was 15th October 1985.
If the full report of the Fifth Parliament’s PAC is a 1981 document, then why should it be presented and tabled in the Sixth Parliament on 15th October 1985? If it is to be presented at the Sixth Parliament, then it must properly be described and referenced as having been tabled in Parliament in 1985 and not 1981. It would appear that in Malaysia we are not only having retrospective legislation, we are also having retrospective tabling of papers in parliament!
In December 1981, the PAC of the Fifth Parliament decided to depart from the usual practice of submitting its report on the 1977 Federal Accounts, by tabling its recommendation first without the minutes of the proceedings – which are the verbatim proceedings of the PAC hearings.
According to this PAC report (DR. 4/1981), “Kami mengambil keputusan untuk tidak mengikut amalan biasa dalam mana laporan kami diserahkan bersama-sama dengan nota-nota keterangan. Demi untuk kepentingan menyampaikan laporan kami dalam masa yang patut dan sewajarnya, kami dengan ini mengemukakan satu laporan mengenai penyiasatan dan syor-syor kami dalam satu dokumen berasingan tanpa menunggu penyiapan nota-nota keterangan penyisatan itu kerana ia akan mengambil masa untuk disiapkan. Walau bagaimanapun ianya akan dibentangkan dalam Dewan sebaik sahaya ia siap dicetak”.
The flexibility of the PAC of the Fifth Parliament to rush out its report and recommendations on the 1977 Federal Government Accounts first is to be commended, but the good it is supposed to do was all lost, when it is unable to bring out its verbatim proceedings report before the dissolution of the Fifth parliament.
This is because the verbatim proceedings of the PAC is an essential part of the PAC report to Parliament, so that Members of Parliament could judge whether the PAC’s report and recommendations are appropriate and justifiable from the PAC hearings, or they are too mild or too harsh.
Standing Order 77(2) provided that a Public Accounts Committee shall be set up ‘as soon as may be after the beginning of each Parliament’, and Standing Order 86(1_ stated that ‘Every Select Committee (which includes PAC), shall make a report to the House upon the matters referred to them as soon as possible’.
Technically and strictly speaking, the PAC of the Fifth Parliament, being a creature of the Fifth Parliament, ceased to exist and same time as the Fifth Parliament was dissolved in March 1982, and as the PAC could not get its verbatim proceedings report on the 1977 Federal Government Accounts presented before dissolution, the report lapsed for the PAC of the Fifth Parliament could not have the ‘after-life’ return to present its report to Parliament, four years after its ‘dissolution’.
The only way to salvage the Verbatim Proceedings Report of the Fifth Parliamentary Public Accounts committee into the 1977 Federal Government Accounts is for the Sixth PAC to present it under its name, making it a 1985 document of the Sixth Parliament, and not introduced surreptitiously into Parliament on 15th October 1985 as a 1981 ‘ghost’ document! Even here, I must confess I am not very sure about its parliamentary propriety!
But what is involved here is not only parliamentary propriety, but that Select Committees including the PAC, must carry out their terms of reference ‘to report as soon as possible’, in any event before dissolution of the Parliament which created them, if they are not to fail in their parliamentary responsibilities.
While the innovation of presenting the PAC’s report to Parliament separately is well-intentioned, I think it is insupportable and unacceptable. The solution to having early presentation of the PAC’s report to parliament is not by downgrading the importance of the PAC’s Verbatim Proceedings Report, but by ensuring that the Verbatim Proceedings could be published at the same time as the PAC’s recommendations.
Otherwise, parliament which set up the PAC would not have the full report to decide whether to accept, reject or amend the PAC’s report.
The rationale to ‘short-circuit’ the procedure in submitting PAC reports was given by the Auditor-General, Tan Sri Ahmad Nordin bin Zakaria, at the PAC meeting on 3rd September 1981 (page 111), where he said:
“… the Committee is trying to short-circuit the procedure, because last October we submitted the Report of the Committee for 1974. Now I am trying my best to be more up-to-date and the Committee agrees that it will submit its Report even before the evidence is available, because like in the courts the records of evidence will not be available for years until there is an appeal. You see, I just follow procedure. If it is good for court it should be good for us, because we are a semi-judicial body. In the case of the court, the evidence taken at the hearing even by witnesses is not submitted with the judgment. The judgment is the findings of the court, whether the accused is convicted or not …. But the records of evidence will not be available until there is an appeal. So similarly, we want to work on the same basis.”
With the greatest respect to the Auditor-General, Tan Sri Ahmad Nordin has got a completely wrong grasp of the nature of the PAC and its duty to Parliament.
Under Standing Order 77, Parliament sets up a Public Accounts committee at the beginning of the session to examine public accounts, and to report to parliament its recommendation. Parliament must then decide whether to accept, reject or amend the PAC’s report and recommendations, and Parliament cannot do this without a full report including the evidence and verbatim proceedings.
The Auditor-General’s comparison of PAC proceedings as court proceedings, where its judgment stands unless appealed against by either party, is highly inappropriate. The PAC’s report is immediately subject to the scrutiny of parliament, and this can only be done with the attachment at the same time of the PAC report and recommendations and the verbatim PAC proceedings.
I hope that in future the PAC would see to it that it would submit a full report, and not an incomplete report carrying its recommendations only, which would deprive MPs the opportunity to pass judgment on the PAC report.
I give notice that I would propose the rejection of all PAC reports in future which are incomplete, which do not have the verbatim PAC proceedings attached to it.
I would later give my proposals as to how the PAC verbatim proceedings could be speedily made available to MPs, so that it would not be an excuse for holding up the submission of PAC reports to Parliament.
Just as ‘Justice delayed is Justice denied’, similarly MPs should realize that ‘Public Accountability delayed is Public Accountability denied’.
MPs would remember that the publication in August 1981 of the Auditor General’s Report on the 1977 Federal Government Accounts made the greatest publicity splash in the history of Auditor-General’s Reports,
It is coincided with the ascension to power of the 2M Government, which took up column-miles of newspaper space to proclaim the new government’s pledge for an Open, Accountable, Efficient and Trustworthy Government.
The Prime Minister, Datuk seri Dr. Mahathir Mohamed, even told the press in August 1981 that the Auditor-General’s Report was being allowed to be made public for the ‘first time’, and showed the 2M Government’s ‘open-ness’! This was of course untrue, for all along, the Auditor-General’s Reports had been published in the press, but that was the first time it was given the blaze of publicity because of government encouragement.
The 2M Government wanted to show in 1981, that it would be very different from previous governments, that it had nothing to hide, that all exposes of government weaknesses, abuses of public funds and inefficiencies would be mercilessly exposed.
But four years after, Malaysians have found that things have not changed much between the 2M Government and previous governments.
Firstly, even up till now, the various weaknesses, irregularities and improprieties in the 1977 Federal Government Accounts pointed out by the Auditors-General’s Report released in 1981 are still unresolved. The best example is the notorious ‘Instant Mee’ scandal in Sabah and Sarawak where the contract price was $4.90 and $3.90 per packet respectively, when the average price was 14 cents a packet in Peninsular Malaysia for the corresponding period.
What accountability can we boast about when in 1985, the ‘Instant Mee’ Scandal is still unresolved. In fact, the investigation and handling of the ‘Instant Mee’ Scandal has become a great scandal by itself. I will come to the ‘Instant Mee’ Scandal later in my speech.
Secondly, despite the promise in the early days of the 2M Government that the government would give priority to ‘public accountability’ by ensuring that the Government’s Annual Financial Statements and the Auditor-General’s Report on the Federal Government Accounts are published promptly, and not as in the past after a lapse of many years, there had been no perceptible change.
As of now, October 1985, Parliament has not received the Auditor-General’s Report for the Federal Government Accounts for 1982, 1983 and 1984. I understand that the Auditor-General’s Report for the 1982 and 1983 Federal Government Accounts have been completed and submitted to the Government. If this is the case, I would want the Finance Minister to explain why the Cabinet is holding back the Auditor-General’s Report for these two years, breaking the 2M Government’s commitment on ‘public accountability’.
I find that there was an interesting exchange of views between the Auditor-General, Tan Sri Ahmad Nordin, and the Accountant-General, Datuk Shamsir bin Omar, in the PAC proceeding on 3rd September 1981 (p.126). The Auditor-General was commenting on the need for the early submission of accounts, and the importance of maintaining public confidence in the integrity of the government financial system.
The Accountant-General, Datuk Shamsir bin Omar, expressed agreement and remarked twice that the PAC (then meeting in September 1981) should be sitting in respect of the 1980 Federal Government Accounts instead of the 1977 accounts.
But the Accountant-General’s remarks were just pious empty expressions, just like the long catalogue of empty assurances given by various Ketua Setiausahas and other top government officials to the PAC which littered the PAC’s Verbatim Proceedings – as if the PAC is just a Big Joke not meant to be taken seriously.
This could be seen by the fact that the Sixth PAC had not submitted its full report on the 1978 and 1979 Federal government Accounts, no sign of any PAC report on the 1980 and 1981 Federal Accounts, while the Auditor-General had not tabled his report to Parliament on the 1982, 1983 and 1984 Federal Government Accounts.
It is only by reading the PAC’s Verbatim Proceedings that one can understand the PAC’s recommendations, whether the PAC is making the desired impact on the government financial system to ensure greater public accountability, or it is a parliamentary exercise which government servants do not take seriously.
Clearly, the PAC cannot expect the government officials to take it seriously for:
Firstly, when the PAC gets to examine the Federal government accounts, it is four or five years after the event and the officials concerned would have retired, resigned or transferred to another department; and
Secondly, when the PAC’s Verbatim Proceedings are published, it is another four or fice years later, when those who appeared before the PAC need not fear being held to their statements, as they would themselves have retired, resigned or transferred off.
A good example is the PAC’s examination into the Auditor-General’s perennial complain about the delays in the payment of Bills by Government Departments.
Regulations required government departments to request Bills to be submitted not later than the month following that in which the purchases were made or the services rendered and Departments should ensure that all bills are paid not later than one month from the date of their submission. (Para 112 of AG’s Report on 1977 Accounts).
As the delays in payment of government Bills could give rise to corruption and various forms of malpractices, the Treasury representative assured the PAC in September 1981 that since October 1980, the government ‘telah mengambil tindakan tegas terhadap bayaran lewat ini’ …. Dan ‘kita akan mengambil tindakan surcharge dan di masa akan datang tidak ada excuse.’
But things have not changed since 1980. Only last month, we read that $7 million in unpaid hospital bills are owed to the Health Ministry, and more than half of this sum involved government servants who were admitted on guarantee letters from their respective departments.
This means that the various government departments are blatantly breaking the Treasury Instructions on payment of Government Bills, and in accordance with the assurance given by Treasury officials to the PAC in September 1981, the responsible officers should be surcharged for the $4 million of outstanding hospital bills. Is this being done? This is urgent, as government hospital services had deteriorated recently, as in some hospitals, common medicine like Panadol is not available.
This reminds me of the case of Hotal Ria in Seremban, which was built at over $5 million to replace the former Rest House. It was rented out to a Bumiputra Company at $10,000, but for the last 24 months, Hotel Ria had not paid a cent, piling up an outstanding debt of $240,000.
Clearly, government financial discipline, whether in paying or collecting payments had not improved despite repeated assurances at PAC proceedings.
I hope the Minister of Finance could enlighten the house how many government officers had been surcharged, and for how much, and whether they had paid up, for contravening the Treasury Instructions Implemented since October 1980 with regard to payment of Government Bills, and imposition of surcharge for defaulting officials.
There has been no follow-up on the assurances given by government officials at PAC meetings, and even recommendations by the PAC had not been given the seriousness they deserve.
In this connection, I want to ask why the Auditor-General had stopped his past practice of listing in his Report the outstanding matter in his previous Audit reports which had not been acted upon, as well as the outstanding recommendations and observations of the PAC in the previous Reports which had not been implemented or dealt with?
In the Auditor-General’s Report on the 1978 Federal Government Accounts, we find that the PAC’s recommendations as far back as 1971 (with regard to the 1966 Accounts) had not been acted upon yet by the Government.
Is this lack of follow-up the reason why the Auditor-General had decided beginning with his Report for the 1980 Federal Government Accounts to stop listing the outstanding matters, whether of his audit comments or the PAC’s recommendations and observations?
This clearly is a retrogressive step in the battle to ensure greater public accountability!
INSTANT MEE SCANDAL
The most scandalous part of the PAC’s Report on the 1977 Accounts is none other than the notorious Instant Mee Scandal, where the contract price was $4.90 per packet for Sabah and $3.90 per packet for Sarawak, when the average price was 14 cents a packet in Peninsular Malaysia for the corresponding period.
During the PAC hearings into the Instant Mee scandal, the PAC found that ‘Instant Mee’ was only one of the seven food items out of a package food contract for 52 items, which were quoted with high price but low quantities, but which were ordered in large quantities to cost some $4 or $5 million loss to public coffers.
The Defence Ministry defended the contract, on the ground that the tender was for a package food supply of 52 items, and not just for ‘Instant Mee’, and the successful tenderer was awarded on the average lump sum price. But as the PAC chairman colorfully put in the PAC meeting of 9th September 1985, (page 218): “Overall price. So if I charge $5.00 for a $2.00 item and 20 cents for a 50 cents item, my overall price would be lower than the next tenderer and I would get the contract, and the Supply Offcer always orders the heavy items so that the contractor makes fat profits.”
And this was what precisely happened in the ‘Instant Mee’ Scandal! What is very shocking is that he lowest price tendered for Instant Mee for Sabah, where the successful tenderer quoted $4.90 per packet, was 10 cents a packet! The Defence Ministry gave a most ridiculous answer as to why this tender was rejected.
But the greatest scandal of the ‘Instant Mee’ affair, is the manner in which the Ministry of Defence had succeeded in stonewalling the PAC’s inquiries and investigations.
PASSING THE BUCK
As the Fifth PAC admitted, it spent the better part of three sittings on the Instant Mee scandal, but to no avail. At the September 1981 PAC meeting, the Ministry of Defence officials told the PAC that the ‘Instant Mee Scandal’ had been referred to the NBI in July 1978. The Director of the Supply Directorate responsible for the ‘Instant Mee’ scandal told the PAC on 9th September 1981 that he was unable to ascertain who was responsible for the manipulation of the figures because “… the NBI came and they sized all my documents and they took away all my files.”
But two weeks later, on 25th September 1981, the then Director of the Sarawak NBI, Abdul Wahid Bin Shamsuddin, told the PAC that the NBI did not at any time investigate the ‘Instant Mee’ scandal.
Furthermore, on the same day, Mindef officials agreed that it should conduct a department inquiry, forgetting the earlier protest by the Director of the Supply Directorate that this could not be done because the NBI had taken away all the relevant files.
Anyone reading the PAC verbatim proceedings cannot but get the impression that the Ministry of Defence was engaged in a massive operation of stone-walling and passing-the-buck.
This was confirmed by the Sixth PAC’s Report on the 1978 and 1979 Accounts (submitted to Parliament on 3rd June 1983), which said:
“40. Jawantankuasa dapati maklumat yang diberi dalam perenggan 34 Memorandum Perbendaharaan (on the Instant Mee Scandal) tidak sepenuh kerana tiada dinyatakan apa-apa keputusan atau pendapat Jawantankuasa Penyiasat yang telah ditubuh oleh kementerian Pertahanan pada 12 November 1981. Semasa membincang perkara ini pada 30 Mei, 1983, Jawantankuasa ini dimaklumkan bahawa Jawatakuasa Penyiasat tersebut telah menyampaikan laporannya kepada Ketua Setiausaha Kementerian Pertahanan. Akan tetapi pihak Kementerian, atas alasan nasihat pengawai undang-undang, telah memberitahu kepada Ketua Odit Negara bahawa isi kandungan Laporan itu sebagai hasil dari penyiasatan Kementerian sendiri, adalah disifatkan sulit dan menjadi ‘privileged document’ dan ini tidak boleh diberitahu kepada sesiapa di luar Kementerian Pertahanan.”
This is most shocking, as the Secretary General of Mindef, who appeared before the PAC on 25th September 1981, Tan Sri Dato’ Mohd. Yusof bin Abd. Rahman, in his evidence admitted that the Committee of Inquiry was being set up at the direction of the PAC. In denying to submit to the PAC the findings of the Committee of Inquiry, the Defence Ministry is guilty of contempt of Parliament.
CONTEMPT OF PARLIAMENT
The Ministry of Defence should be given two weeks to submit the Report of its Committee of Inquiry into the Instant Mee Scandal, failing which, the Ministry of Defence officials responsible should be committed for Parliamentary contempt.
This will show to all government officials that the PAC means business, and would brook no obstruction from any government officials, whatever the excuse or guise, including plea of confidentiality.
It is a mockery of very principle of parliamentary democracy and the sovereignty of Parliament that a government department could deny the PAC results of investigation initiated at the PAC’s directive on the grounds of confidentiality. It is for the PAC to consider the Ministry’s request that the Committee of Inquiry’s Report should not be made public, but not to deny the report to Parliament altogether. If this principle is not established, then the principle of government accountability to Parliament would suffer a grievous blow.
For this reason, I wish to move an amendment to my motion, to insert the following new paragraph before the final paragraph:
“Further notes Paragraph 23.1 to 23.11 of the PAC Report on the 1977 Federal Government Accounts, as well as paragraphs 40, 41 and 42 of the PAC Report on the 1978 and 1979 Federal Government Accounts; and Resolved to give the Ministry of Defence two weeks to submit to the PAC the report of the Ministry’s Committee of Inquiry on the Instant Mee scandal, failing which the Ministry of Defence officials responsible would be committed for contempt of Parliament.”
FEAR OF GOD
The PAC is the highest custodian of government public accountability, but it is now regarded as a joke, being toothless, obsolete and ineffective, producing outdated reports which interest nobody.
For instance, according to paragraph 35 of the PAC’s Report on the 1978 and 1979 Federal Government Accounts, the PAC was helpless in pressing disciplinary or legal action against a former official of the Ministry of Primary Industries, Adenan bin Satem, who, through his negligence caused the nation to lose $20.26 million. According to the Ministry’s Legal Adviser, no action could be taken against Adenan Satem because he had left the government service. Today, Adenan bin Satem is an Assemblyman in Sarawak and slated to be a future Sarawak State Cabinet Minister.
Surely, the PAC should not be so helpless to protect the country’s financial interest, and the government should be instructed to file civil proceedings against Adenan Satem for reimbursement of the $20.26 million lost to the country through his negligence.
As an Assemblyman in Sarawak, Adenan bin Satem should also be made to realise that he has moral responsibility to reimburse the government for the loss of $20.26 million.
The PAC must be able to put the ‘fear of god’ into public officials if it is to be an effective watchdog of public accountability. The PAC’s greatest weapon is publicity, to expose public officials to the glare of publicity about their incompetence, negligence and indifference to public accountability.
Parliament and the Government is now being ‘penny wise, pound foolish’, for if the PAC is allocated adequate funds to enable it to be effective, it should be able to save the country tens and hundreds of millions of dollars in terms of elimination of wasteful, improper and even irregular government financial practice.
For this reason, I would make the following proposals to make the PAC an effective custodian of government public accountability:
Commitment by Government and parliament to allocate adequate funds for Parliament and PAC to discharge the task of custodian of public accountability;
Holdings of PAC proceedings in public, and the daily publication of the verbatim proceedings of PAC meetings.
The present practice of publishing the entire verbatim proceedings of the PAC which lasted 16 days for the 1977 Federal Government Accounts in September 1981 in one volume of 730 pages four later is one of the stupidest acts one could think of. This is because after the lapse of years, and with the thickness of volume, it would guarantee that most MPs would not even touch it.
Secondly, the daily publication of the verbatim proceedings of the PAC would enable the PAC to submit its full report (its recommendations together with the verbatim proceedings to parliament without delay, when the recommendations are ready.
Thirdly the daily publication will put the ‘fear of God’ into government officials for they know their infractions would be publicised immediately, and not hiding away in some thick tomb which when the published several years later, nobody is interested.
Tabling in Parliament of the Treasury’s Memorandum on the PAC report within a week, so that a Parliamentary debate on the PAC report as well as the Treasury Memorandum could be held at latest two weeks after tabling of the PAC report.
I believe that the above proposals would make the PAC a meaningful institution. In my motion, I mentioned that the Sixth Parliament had not tabled a full report yet to Parliament. Parliament is expected to be dissolved soon, if there is going to be early general election. The Sixth PAC should work overtime to table all its reports to the Dewan Rakyat before the dissolution of the present Parliament, for it would indeed be another mockery if the Sixth PAC appointed by the present Sixth Parliament is working towards a schedule which would mean tabling their reports for the next Seventh Parliament after the next elections.
(Speech by Parliament Opposition Leader, DAP Secretary-General and MP for Kota Melaka, Lim Kit Siang in Dewan Rakyat on the motion on the Report of the Public Accounts committee on October 21, 1985)