Speech by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjong, Lim Kit Siang, in the Dewan Rakyat or: the 1993 Supplementary Supply and Development Estimates on 27th July 1993
The Finance Ministry has not complied with the Standing Orders in presenting the second set of 1993 Supplementary Estimates totalling RM432 million
Just as it seems to have become the habit of the Barisan Government to introduce a Constitution Amendment Bill every time Parliament meets, it has also become the habit of the Finance Ministry to ask for supplementary votes for operating and development expenditures every time Parliament meets,
This is the second Parliamentary meeting for this year and we have before us the second set of supplementary estimates for 1993, RM RM296,393,300 as second 1993 supplementary estimates for Operating expenditure arid RM136,103,580 as second 1993 supplementary estimates for development expenditures.
It must be noted that this second set of 1993 supplementary estimates is about five times bigger than the first set of 1993 supplementary estimates approved at the last meeting of Parliament, Together, both sets of 1993 supplementary estimates would, have exceeded by over 10 per cent the original 1993 Budget passed by Parliament last year, which is RM32 billion tor Operating Expenditures and RM1.1 billion for Development Expenditures.
I believe that there may be another two or three sets of supplementary estimates for the 1993 Budget to be presented in forthcoming Parliamentary meetings going into next ‘year, by which time the total supplementary estimates could exceed the original 1993 Budget by over 25 per cent.
This seems to make a ^mockery of the 1993 Budget, where the final estimates could exceed the original estimates by over 25 per cent, and shows that there is something very wrong both in preparing as well as in monitoring the budget.
Furthermore, the supplementary bill and the supplementary development motion before tiie House today totalling RM432 million had not been tabled in accordance with the requirements of the Standing Order 67(1} of the House.
Under this Standing Order”, a supplementary bill must be accompanied by a supplementary estimates giving particulars for the additional votes which the government is requesting from the Dewan Rakyat, and such supplementary estimates should show four items:
(i) the total sums already authorized under the head;
(ii) the additional expenditure required under any sub-head
(iii) the amounts of any savings from other sub-heads under the same head which can be applied to reduce the supplementary appropriations required to meet such additional expenditure;
(iv) the amount of the supplementary appropriation required for the head.
The third item, the amounts of any savings from other subheads under the same head which can be applied to reduce the supplementary appropriations required to meet such additional expenditure, has not been presented in the supplementary estimates.
I hope the Finance Minister would take note of this violation of the Standing Orders and parliamentary requirements and ensure that this item is not omitted in future requests for supplementary appropriations.
There is a very important reason for this requirement. – to impose on the Finance Ministry and all government departments the financial discipline to ensure that they exercise the greatest economy and efficiency in expenditure of government funds,, and if new appropriations are required, they should seek to generate a portion of the expenditures from savings in their own departments.
Similarly, whenever the Government comes to the House to seek approval for supplementary supply and development estimates, it, must satisfy Parliament, that. it had exercised financial prudence and had not been guilty of waste, negligence, irresponsibility, abuses of power or corruption.
The Finance Minister, Dat.uk Seri Anwar has claimed that he believed in an open, accountable and transparent, government, but he has allowed the system of checks and balances to ensure financial probity, efficiency and accountability to wither and atrophy,
DAP calls on Anwar Ibrahim to explain whether Bank Negara had lost another RM2.7 billion from foreign exchange in the first six .months of the year
A good example is the role of the Public Accounts Commit-tee. In the RM16 billion Bank Negara foreign exchange scandal last year, the Finance Minister has not upheld the principles of openness, accountability and transparency, when he countenanced the refusal of the Bank Negara Governor and other officials to subject themselves to a. full examination by the Public Accounts Committee.
As I said during question time on the first sitting of Parliament on July 19, I understand that the foreign exchange; losses of Bank Negara had continued to increase since the end of last year. Although this has been denied by Anwar Ibrahim, it is significant, that he could not give facts and figures which should be in his possession.
For instance, in the 1992 Bank Negara Report, there was a provision of RM2.7 billion for contingency liability being “net liaiblity for forward exchange positions.”
This is already July and all the forward exchange positions should have matured. I call on Anwar Ibrahim to disclose to the Malaysian public whether the contingency liability for RM2.7 billion in the 1992 Bank Negara Report had been proved right with Bank Negara losing another RM2.7 billion in foreign exchange losses in the first, six months of the year, or whether Bank Negara had instead made profits from these forward positions, and if so to give the details.
The RM16 billion Bank Negara forex losses is the biggest, financial scandal in Malaysian history, bigger than the RM2.5 billion Bumiputra Malaysia. Finance scandal by five to six times.
The Finance Minister be seen by the people as taking a very serious approach to the unprecedented forex losses suffered by Bank Negara. Anwar Ibrahim should .know that in Mongolia, two former central bank governors and three; of their staff were charged in court for negligence and over-stepping their authority in gambling for two disastrous years on the world’s foreign exchange markets, causing a loss of US$90 million.
Although this sum in equivalent, to virtually all Mongolia’s hard-currency reserve, it is a puny figure compared to the RM16 tail-lion forex losses of Bank Negara,
Yet the Finance Minister had resisted DAP calls for a Royal Commission of Inquiry, and even refused to allow the Public Accounts Committ.ee to conduct a full-scale examination.
What is even more shocking is that the Public Accounts Committee, despite meeting on the Bank Negara forex losses last, month, has not presented its report, comprising both its recommendations and the verbatim proceedings, despite the urgency of the issue.
Call on Public Accounts Committee Chairman, Datuk Dr. Affifudin Omar, to explain why no PAC report, both of recommendations and verbatim proceedings, had been presented to Dewan Rakyat for the last three years
In fact, the Public Accounts Committee Chairman, the MP for Padang Terap, Datuk Dr. Affifudin Omar, should explain why since he became PAC Chairman, no report from the Public Accounts Committee had ever been tabled in the Dewan Rakyat for nearly three years?
Datuk Affifudin Omar should realise that, the PAC does not operate in a vacuum, but is acting on the delegated authority of the Dewan Rakyat, arid that it must report to the Dewan Rakyat its recommendations as well as submit its verbatim proceedings.
Until the PAC had submitted its report, and verbatim proceedings to “the Dewan Rakyat, it had not concluded examinations into the accounts either of the Federal Government or of the statutory authorities.
In failing to submit a single PAC report to the Dewan Rakyat in the past three years, it means that the PAC had not concluded its examinations on any single item.
This is most deplorable. I know that the PAC had been conducting meetings on the Federal Government accounts, but why has the PAC Chairman been unable to ensure; that PAC reports are submitted to the Dewan Rakyat for consideration and even debate without any delay.
It is ridiculous for the PAC to criticise government departments for delay in submitting accounts, when the PAC itself is guilty, not only of delay, but in failing to submit any report whatsoever to the Dewan Rakyat in the past three years.
This is where the system of checks and balances to ensure financial probity, accountability and transparency in government has completely broken down with the failure of the PAC to submit. its reports -to the Dewan Rakyat.
Challenge to Anwar Ibrahim to declare his stand on the unusual and extraordinary wealth of Malacca Chief Minister, Tan Sri Rahim Tamby Cik
In his now-famous intervention in my speech on the Sewerage Services Bill in the Dewan Rakyat last Thursday, Anwar wants to give the impression that he takes an uncompromising position against corruption in high political places.
Anwar Ibrahim is the Chairman of the Cabinet Committee on Corruption and Malpractices. I challenge him to declare his stand on the extraordinary and unusual wealth of the Malacca ‘Chief Minister, Tan Sri Rahim Tamby Cik, as exposed by the DAP MP for Kota Melaka, Sdr. Lim Guan Eng, who up to now had revealed that the Malacca Chief Minister’ is worth RM24.65 million although his salary and income as Chief Minister for the last, ten years came up to only RM1.8 million.
In countries where governments take anti-corruption more seriously, Government leaders with such unusual wealth would be suspended from office and investigated by anti-corruption agencies, but in Malaysia, Tan Sri Rahim has become the standard-bearer for Anwar Ibrahim in his political ambitions.
Under these circumstances, when corruption, abuses of power and unethical practices have become so rife and rampant in Malaysian public life, where slogans of ‘clean, efficient and trustworthy5 and ‘open, accountable and transparent’ government remain mere slogans, Malaysians are rightly concerned when Anwar announced last, month that the Cabinet had decided to privatise and sell most of the 1,189 federal and state government-owned companies with a total paid up-capital of RM35.78 billion.
DAP calls on the Cabinet to rescind alienation of 365 acres at Bukit Kiara, Kuala Lumpur to Kuala Lumpur Golf and Country Club Sdn. Bhd.(KLGCC)
Has Anwar Ibrahim succeeded in instilling a sense of financial and moral discipline, responsibility and accountability in the Government in the two years he became Finance Minister?
For instance, can he explain what the Government has decided on the Dewan Bandaraya Kuala Lumpur (DBKL} Solarvest scandal, where in June 1991, 365 acres of Bukit Kiara land was alienated to Singaporeans’ Lum Chang Holdings Group for the Kuala Lumpur Golf And Country Club Sdn. Bhd. (KLGCC) at RM59,725 per acre without open tender, when the market price could be close to a million ringgit per acre, fetching some RM365 million.
I understand that the Cabinet reviewed the DBKL scandal over a month ago, and the latest proposal that Kuala Lumpur Golf and Country Club Sdn. Bhd repay RM25 million for the land they acquired at cost from DBKL.
This is clearly unacceptable, as the repayment of RM25 million is no way to resolve a RM365 million scandal. If Anwar Ibrahim is to stand up for the rights and the interests of Malaysians, he should get the Cabinet to rescind the contract as Kuala Lumpur Golf and Country Club Sdn.Bhd. had committed fundamental breach of the contract which entitled the DBKL to revoke the alienation.
Newspapers have reported that work for the Kuala and Country Club was almost completed and the clubhouse is expected be ready by September.
Does this mean that the PAC is a toothless and utterly irrelevant institution? Parliament is entitled to know what is the Cabinet decision on the recommendation of the PAC.
Finance improprieties at the DBKL have not ended as the accounts for the 100-men DBKL Casablanca junket have not been closed
Financial improprieties at the DBKL has not ended with the departure of former Dat.uk Bandar, Tan Sri Elyas omar. Even before Tan Sri Elyas Omar and his 100-man delegation left for the Barcelona Olympics in early July via Casablanca, purportedly to commemorate the twinning of Kuala Lumpur with the Moroccan capital, 1 had alerted the authorities of such abuses of power in the hope that such extravagant waste of public funds could be stopped,
Anwar Ibrahim should explain- why as the Finance Minister in charge of propriety of expenditure of public funds, he had failed to take immediate action at the time- The matter would have been hushed up and Tan Sri Elyas Omar would have continued as Datuk Bandar today if our expose of the Volvos scandal had not blown the roof off DBKL.
I understand that a year after the junket, the accounts for the Casablanca trip had not been closed.
The fifteen team leaders of the DBKL trip to Casablanca, some led by VIPs , like the Deputy Minister and the former Datuk Bandar were advanced cash for trip expenses. I understand that the .example of the Deputy Minister who did not submit a full breakdown of his expenses for the RM90,000 advanced to him has been used as a excuse for several other team leaders not returning unspent cash.
The highest figure outstanding from a team leader for the Casablanca trip is RM100,000, and this officer has gone on a year study leave overseas.
Financial discipline in the DBKL is very low, as the DBKL Treasurer’s attitude is that in cases of in isappropriation of DBKL funds by DBKL staff, there is no point in sending the guilty ones to jail as DBKL would not be able to recover anything.
For instance, in the Setapak DBKL sub-office, a staff stole RM40,000 in 1990 and is paying back by instalments of a few hundreds of ringgit a month. No further action was taken and this staff is recently considered for promotion. Another staff at the Damansara sub-office stole RM44,000. No action was taken when he threatened to disclose all other cover-ups and he is repaying by token instalments.
The parlous state of the finances in the DBKL could be gauged by the fact that the present Treasurer had squandered the RM165 million on fixed deposit accumulated by the former Treasurer, Tay Yoon Lay, who retired about 15 years ago.
During the debate on the Royal Address in April this year, I spoke of the urgency and importance of satisfactory mechanism to check abuses of power and misuse of public funds.
The scandal of the RM300 million North Butterworth Container Terminal which would not be able to operate for one year after completion because of no gantry cranes
I had called for an explanation from the Finance Ministry as to why it was overruling the three appeals submitted by the Penang Port Commission and was awarding the contract for three container-gantry cranes for North Butterworth Container Terminal to GEC of Australia which did not meet the specifications of the tender.
I had also warned that with the bungling by the Ministry of Finance and Ministry of Transport on this issue, the RM300 million North Butterworth Container Terminal would not be operational for six months when it is completed in June 1994, as it would have no cranes to operate for at least six months.
My warning has been proved correct, as the new PPC Chairman, Zahrain Mohamed Hashim, who said that the North Butterworth Container Terminal would not be able to handle* container traffic until April 1995 – i.e. one year after its scheduled date of completion because of ‘the problem over the gantry cranes.
For one year, Penang and Malaysia would have a modern container terminal which it could not use! Surely, heads must roll for such incompetence, both in the Finance Ministry and the Transport Ministry, but we seem to take such incompetence for granted. Clearly, the Barisan Nasional’s ‘Look East’ Policy where top government leaders accept personal responsibility for failures in their department had been an utter flop.
It is most, deplorable that I was not given any reply in Parliament, either by the Minister for Finance: or the Minister’ for Transport, when I raised this issue in the .Bewail Rakyat last April. I now learn that the Ministry of: Finance has issued a letter of intent to GEC of Australia.
Let me give the background for this North Butterworth Container Terminal scandal.
Tender for three units of Container Gantry Cranes for North Butterworth Container Terminal Project, was called on 1st September 1991 and closed on 31st October 1991. The following seven companies participated in the tender, namely:
1. Meltana – RM33,640,200
2. Intan Karang RM37,570,415
3. Samsun g RM37,248,880
4. UMW/IMPSA RM41,955,000
5. C. Itoh RM51,658,415
6. Noell RM54,912,150
7. GEC Australia RM56,128,Q39
In fact, the Penang Port Commission Tender Board never considered the tender submission by GEC Australia as it had not complied with the condition that a tenderer must have a previous track record in the design and construction of the Container Gantry Cranes required for the North Butterworth Container Terminal Project.
Furthermore, GEC Australia had also failed to comply with the technical specifications of the tender, such as:
1. Rail trolley capacity required in the tender is 37 Kg/in but GEC Australia offered 31 Kg/m;
2. Design of hoisting system uses two motors which is unorthodox method. No crane builder offered such a system;
3. Power of motor for boom hoist is 67 Kw – small compared to needed capacity of 80 Kw;
4. Cable used for cable reel transmit current of 104Amp but power needed for crane should be 130 Amp arid above;
5. Spreader used is Electrux – unheard of in this region and hence difficulty in parts availability. A popular spreader brand is ‘ Bromma’ widely used in all parts of South East Asia;
6. Gear box for trolley and gantry system is David Brown – unheard of in this region and hence parts availability will be a big problem.
The reasons for G.EC Australia’s non-compliance with the PPC tender specifications stein from the fact that it is a non-crane supplier.
This was why when the PPC Tender Board evaluated and submitted its recommendations to the Ministry of Finance, GEC Australia was never considered at all.
However, when the Ministry of Finance reversed the decision of the PPC Tender Board and decided in favour of GEC Australia,- PPC submitted an appeal on the following five grounds:
1. GEC Australia never complied with the technical specifications of the tender;
2. GEC Australia had claimed in its submission that it had supplied gantry cranes to various ports in Australia. In order to appeal against the Finance Ministry decision to award the tender to GEC Australia, PPC wrote to all the Australian ports and received replies that this claim was untrue;
3. If the PPC Tender Board had known that GEC Australia had submitted false and untrue claims and references when it conducted its evaluation exercise, it would have disqualified GEC Australia from the outset;
4. A further check was made by PPC by obtaining information from ‘Containerization International Year Book’ where it was noted that there was not a single GEC crane in the world:
5. PPC wrote to GEC Australia asking them to show proof that. it is crane designer and manufacturer,, and received the reply that it produces cranes using ‘Cooper Crane Design’. This clearly showed that GEC Australia had never been a craner builder and hence will not meet the needs and requirements of PPC, There is a great danger that the cranes when delivered will be another ‘white elephant5 project.
On the commercial aspect, there are also several discrepancies. When GEC Australia submitted the tender,, it offered in Australian dollars of A$25,512,645 with a grant of 35 per cent of the FOB, However, months later, it wrote to PPC mentioning that the grant was based on 35 per cent of the GIF value. In normal practice, a post-tender letter could never be accepted.
Since the tender closed on 31st October 1991, PPC had been asking for tenderers to extend their performance bond several times and asking tenderers to confirm that their prices and terms and conditions remain unchanged, GEC Australia however stated that it could not agree to the price fixation when-the tender closed as Australia was lacing a recession and requested for a price increase.
If the Ministry of Finance has decided to award the tender just on price and not the technical offers, then there is the Yugoslav bidder, Meltane from Slovene which has erected six gantry cranes in Bangkok.
If we look at the ports of Malaysia, we can find such renowned brands being used like Samsung, Hyundai, Mitsubishi and lately Impsa from Argentina.
Impsa had built cranes in China and elsewhere, and is a genuine crane builder, and the Prime Minister, Dat.uk Seri Dr. Mahathir Mohamed, had visited the Impsa’s factory in Argentina.
A new breed of government ‘ lobbyists’ whose intervention would be worth millions or even tens of millions of ringgits
PPC would become the scapegoat if the government proceed with the tender award to Australia. PPC is expected to corporatize and later privatize and they are buying cranes from their own funds. Why can’t PPC be allowed to choose what they want?
The life span of a gantry crane is 15 to 20 years. With the launching of the North Butterworth Container Terminal, Penang is expected to play a very important role in terms of containerisation within the Northern Triangle. The equipment must be able to perform efficiently with minimum downtime operation. The image of the port is very essential.
The Ministry of Finance had allowed extraneous factors to affect its decision, ignoring the important key issue of boosting the trade performance of the Penang island state.
The Government must re-examine immediately the tender exercise and recall the tender altogether.
Parliament is entitled to know the reason for the Finance Ministry rejecting the strong recommendations and appeals of PPC, the end user of the cranes. Is this because in the final analysis, what is most important in award of government contracts (as well as privatisation awards) is not the technical specifications or financial proposals, but the person involved in the lobbying.
It is clear that the system of Malaysian government contracts , tenders and privatisation has spawned an select breed of lobbyists whose intervention with the power s-that-foe is worth millions and even tens of millions of ringgit .
GEC Australia is promoted by a well-known lobbyist. Tan Sri A. P. Arumugam, who had been responsible for securing for companies contracts from the government worth hundreds of millions of ringgit and even billions of ringgit, like the RM1 . 8 billion Pergau project, the RM180 million EMU Railway coaches contract, and the contract for the armed forces bunker in Jalan Gurney – just to name a few.
The RM23 million Kuala Lumpur Computerised Traffic Light System that requires the manual help of traffic policemen
Another Arumugam ‘coup’ is the RM23 million Kuala Lumpur Computerised Traffic Light System, which created total chaos in the Kuala Lumpur traffic for three days earlier this month when the City Police Chief, Datuk Henry Chin, pulled out ail traffic police from manning junctions and roundabouts following complaints that traffic police were a hindrance to the smooth implementation of the computerised traffic light, system. This was the second “pull-out1 by the Kuala Lumpur traffic police in three months.
The Kuala Lumpur Police made the point that, traffic police were not a hindrance to the smooth implementation of the computerised traffic light system, and everybody seems to be happy.
Nobody has stopped to ash why the much-vaunted RM23 million computerised traffic light system needed policemen at most roundabouts and junctions to make it work.
When the $23 million Kuala Lumpur Computerised Traffic Light System required traffic policemen to direct traffic manually, then the system has failed completely. The GEC-Marconi system, bought on an Anglo-Malaysian government-to-government agreement, was hurriedly implemented on a negotiated contract without proper checks and balances. From the start, knowledgeablel traffic experts saw it as a failure, but those responsible for its ultimate use had no say in implementing the system – just as the position the PPC finds itself in with regard to the tender for the three Gantry Cranes.
I understand that GEC-Marconi which supplied the Kuala Lumpur Computerised Traffic Light System which require traffic policemen to operate will be awarded the RM500 million avionics/navigation contract for the new Kuala Lumpur International Airport