Thursday, February 26, 2015

KPMG Should Declare Its Role In The 1MDB Petrosaudi Scandal

Did KPMG fail their duty to protect the interest of the Government and the Malaysian public when scrutinising and signing of the Financial Reports of 1MDB in the light of the Petrosaudi exposé?

The Sarawak Report exposed the secret 1Malaysia Development Bhd (1MDB) and Petrosaudi International Limited (PSI) joint venture (JV) agreement dated 29 September 2009, revealing details which points towards a highly elaborate scam to siphon money from 1MDB.

Despite knowing that “1MDB Petrosaudi Limited” had a dubious existing debt of US$700 million, 1MDB agreed to invest US$1 billion (RM3.5 billion) into the newly set up company to subscribe for 40% of new shares.  Hence 1MDB had invested US$1 billion in a JV where the JV partner immediately gets to siphon 70% of the funds out of the joint venture for practically nothing in return.

Wednesday, February 25, 2015

Idris Jusoh Should Learn What's "World Class" Education

Deputy Education Minister Datuk Seri Idris Jusoh should stop making a mockery of our Higher Education system by liberally interpreting what is “world class” and selectively highlighting statistics which are favourable to the local universities.

Despite being mocked publicly for his statement that Malaysia has “world class higher education”, Datuk Seri Idris Jusoh continued to dig trenches to defend his fantastic claim.

The Deputy Education Minister continued to defend our local universities’  “world class” status by citing the various overall and subject rankings produced by British firm, Quacquarelli Symonds (QS) over the years.

Idris had said Universiti Malaya (UM) was now in 151st position (up from 167) in the list of 400 top institutions in the world in the 2014 QS World Ranking of prestigious universities.

He said besides the aspect of foreign students enrolment and university rankings, the country’s higher education could be said to be world class based on other factors such as achievement in subjects, whereby 11 public institutions of higher learning were listed among the top 100 universities in the world.

For example, “based on QS Ranking by Subject, Universiti Sains Malaysia (USM) is in the 28th position in the world for environmental science while Universiti Putra Malaysia (UPM) is ranked 54th worldwide for agricultural science based on the Best Global Universities Rankings,” he said.

Firstly, assuming that the QS World Ranking Table is a reliable measure of quality, there is absolutely nothing “world class” about UM being ranked 151st in the world.  None of the other 19 local public universities, 36 private universities and 30 university colleges ranked within the top 250 in the world.  Even if Malaysia chooses to define the 151st ranking as being “world class”, one swallow certainly does not maketh a summer.

Secondly, while all ranking methodologies are imperfect, why did Datuk Seri Idris choose to cite only the QS rankings out of several reputable global university rankings tables out there?  In fact, of the handful of rankings tables, QS is perhaps the most criticised for its lack of rigour and consistency in its methodology.

Between 2004 and 2009, QS had produced their university rankings in partnership with The Times Higher Education (THE) Supplement, the leading publication on higher education in the United Kingdom.  However that partnership ended when THE rejected QS and its much criticised methodology, resulting in THE creating its own separate rankings.

Among the biggest critics of the QS rankings is Professor Simon Marginson, a professor of higher education at the University of Melbourne. He described the QS World University Rankings as having "a lot of dark spaces and problems the way they go about it", adding that 40-50 per cent of the ranking was based on reputational surveys.

"They've got a ranking process which they've done very cheaply ... and that's a loss leader for a lot of other business activities," suggesting a conflict of interest between their ranking table and their provision of various consulting services to universities.

Without even taking into consideration of the quality of QS’s work, all other widely cited University Rankings Tables in the world do not rank any Malaysian institution of higher learning anywhere near the top 200.

Not a single Malaysian university made it into the Top 400 list institutions of the THE World University Rankings for 2014 .  The Academic Ranking of World Universities produced by Shanghai JiaoTung University placed UM in the #301-400 category in 2014 .  For the US News “Best Global Universities” listing, UM again was the only Malaysian institution that made it into the Top 500 at #423 .

In the Ranking Web of Universities compiled by Webometrics, UPM was best ranked at 420, followed by Universiti Sains Malaysia (480), Universiti Teknologi Malaysia (552) and UM (646).

Let me emphasize here again that no ranking system is perfect. Such tables do however provide indicative relative quality rankings between global universities.  The question to ask is therefore, why is the Ministry of Eduation only selectively interested in the QS Rankings, and failed to cite any of the other studies?  Is it because all of the other studies rank Malaysian universities very badly?

Datuk Seri Idris Jusoh appears to be behaving like the proverbial “ayam berkokok, riuh sekampung” when he insisted that Malaysia has achieved “world class” higher education standards.  As the Deputy Education Minister, Malaysians would hope that he could be more enlightened and honest in his assessment of our local education standards.

While we are thankful that we are certainly not in the league of many Third World countries, we are far from being able to proclaim ourselves as world class without sniggers from both the academic world and the knowing public.

Tuesday, February 24, 2015

1MDB In Serious Financial Distress?

A RM3 billion bailout from the Ministry of Finance for 1Malaysia Development Berhad (1MDB) proves that 1MDB is in serious financial distress despite the valiant denials by the Government.

It did not come as a surprise to read the headlines of The Edge Financial Daily yesterday which hinted of a “MOF Cash Injection For 1MDB” in an article entitled “After loan from Ananda Krishnan, 1MDB may need the ministry’s money”.


The breaking story reported that “1MDB was not only helped by billionaire T. Ananda Krishnan to settle its RM2 billion debt to banks, but it may also require a cash injection of as much as RM3 billion from its owner, the Ministry‎ of Finance (MoF), say sources.”

Monday, February 23, 2015

1MDB CEO's Response To 1MDB Petrosaudi JV Scam Raises Further Questions

CEO Arul Kanda must explain where is the purported US$488 million of “profit” arising from the 1MDB joint venture with Petrosaudi International.

The Sarawak Report exposed the secret 1Malaysia Development Bhd (1MDB) and Petrosaudi International Limited (PSI) joint venture (JV) agreement dated 29 September 2009, revealing details which points towards a highly elaborate scam to siphon money from 1MDB.

Despite knowing that “1MDB Petrosaudi Limited” had a dubious existing debt of US$700 million, 1MDB agreed to invest US$1 billion (RM3.5 billion) into the newly set up company to subscribe for 40% of new shares.

Immediately after the signing of the agreement, “1MDB Petrosaudi Limited” repaid in full, the US$700 million (RM2.5 billion) of advances to PSI using the newly received funds from 1MDB.

I had earlier asked the Prime Minister Dato’ Seri Najib Razak and 1MDB to explain why on earth did 1MDB invest US$1 billion in a JV where the JV partner immediately gets to siphon 70% of the funds out of the joint venture for practically nothing in return?


The response from the newly appointed CEO of 1MDB, Arul Kanda Kandasamy was both disappointing and obviously evasive.

Saturday, February 21, 2015

Secret 1MDB Petrosaudi Joint-Venture Agreement Exposed: Gross Abuse Of US$1 Billion Of Funds Revealed

The scandalous 1MDB-Petrosaudi joint-venture agreement stinks to high heavens, highlighting gross abuse of US$1 billion of funds guaranteed by the Federal Government.

The Sarawak Report exposed the secret 1Malaysia Development Bhd (1MDB) and Petrosaudi International Limited (PSI) joint venture agreement dated 29 September 2009, revealing details which points towards a highly elaborate scam to siphon money from 1MDB.  This agreement was signed between Tarek Essam Ahmad Obaid, CEO of PSI and Datuk Shahrol Azral Ibrahim Halmi, the then Managing Director of 1MDB.

Tuesday, October 14, 2014

1MDB Energy Receives Yet Another Bail Out From The Government

The Government is pulling all stops to bail out 1MDB Energy after multiple Initial
Public Offering postponements with lucrative directly negotiated power contracts at
the expense of higher electricity tariffs in the future.

The Minister of Energy, Green Technology and Water has confirmed in his reply to me on
Thursday last week that the Government has awarded another power plant project via direct
negotiations to 1Malaysia Development Berhad (1MDB). This 2,000MW gas-turbine power
plant sited in Melaka was rumoured to have been awarded in late August this year.

Earlier in April, Tenaga Nasional Bhd (TNB) had signed another power purchase pact with
1MDB on the construction of a solar power plant. 1MDB will design, construct, own, operate and
maintain a 50MW solar photovoltaic energy facility in Kedah and supply electrical power to TNB.
Before that 1MDB was also controversially awarded an RM11 billion 2,000MW coal-fired power
plant in February despite offering a higher power tariff in an “open tender” exercise.


Wednesday, July 30, 2014

Dr Mohd Zuhdi Marzuki Perlu Meminta Maaf Atas Pendapat Yang Rasis Dan Ekstremis

Pengarah Operasi Pusat Penyelidikan PAS (PPP) Dr Mohd Zuhdi Marzuki perlu
meminta maaf kepada semua rakyat Malaysia ke atas pendapat beliau yang
bersifat rasis dan ekstremis.

Berikutan kontroversi yang terbangkit seteleh mesej WhatsApp Dr Mohd Zuhdi Marzuki
dalam kumpulan Ahli Jawatankuasa PAS Pusat terdedah secara meluas, beliau telah
menjelaskan bahawa beliau “tidak termasuk dalam senarai mereka yang menyokong usul
keluar PR itu.”

Beliau berkata “semoga dengan penjelasan ini, nama saya dapat dibersihkan daripada
tanggapan buruk pelbagai golongan ekoran sikap segelintir pihak di dalam PAS yang
membangkitkan fitnah yang sedang tidur."

Rakyat Malaysia tidak mempertikaikan langkah Dr Mohd Zuhdi mengkaji sama ada PAS patut
berada di dalam ataupun keluar daripada gabungan Pakatan Rakyat. Pendirian Dr Mohd
Zuhdi untuk keluar atau kekal dalam Pakatan juga tidak merupakan tumpuan kritikan. Itu
merupakan hak ahli PAS.

Wednesday, March 05, 2014

Dato' Seri Najib's “Kangkung” Economic Model With 1MDB

Dato' Seri Najib Razak is practising “kangkung” economics by awarding lucrative
multi-billion contracts to qualified parties who are not the lowest bidders.

On 28th February, the Energy Commission (EC) confirmed weeks of alleged “baseless speculation”
that 1MDB will be awarded the new Independent Power Producer (IPP) 2,000MW coal-fired
power plant concession. The project is said to be worth RM11 billion.

Tuesday, February 18, 2014

Energy Commission Awards Power Plant Project To 1MDB Instead Of Lowest Qualified Bidder

The Cabinet must prioritise the interest of the rakyat and not the profits of its
companies when deciding on the “winner” of the power plant projects.

It has been reported by The Edge Financial Daily over the past 2 weeks that the Energy
Commission has decided to award the latest 2,000MW coal-fired power plant to 1Malaysia
Development Bhd (1MDB).

The paper reported that “according to industry sources, the board of the Energy Commission (EC)
has decided to propose 1MDB as the preferred bidder for the RM11 billion planting­up exercise to
the Ministry of Energy, Green Technology and Water”.

This is despite the fact that the bid submitted by 1MDB at 25.65 sen per kWh is higher than that
submitted by another tenderer, YTL Power at 25.23 sen per kWh. The difference of 0.42 sen per
kWh is estimated to constitute a difference of RM2 billion over the 25 year concession period.
What is more disturbing is the fact that based on documents sighted by The Edge, “the EC’s
technical evaluation committee had recommended YTL Power as the preferred bidder for the
tender in December last year”.


Friday, August 30, 2013

Finance Ministry Secretary-General’s Arrogant Remarks of Fitch Rating’s Outlook Revision


Finance Ministry Secretary-General Tan Sri Dr Mohd Irwan Siregar Abdullah has blamed the Fitch Ratings revision of Malaysia’s economic outlook to ‘negative’ by saying that the ratings agency was run by young analysts. He had even jokingly said he regarded the case of Fitch Ratings as “ratings analysts from Hell”.

The sheer contempt and arrogance in the comments made by the Finance Ministry Secretary-General exposes the fact that the Government doesn’t treat the negative outlook revision by Fitch Ratings last month as important.

These comments are consistent with the position of Dato’ Seri Najib Razak, who is both the Finance and Prime Minister, who tried to make light of the negative revision by pointing out that Fitch still “affirmed our rating”. He said negative element “is just the revision of our outlook but that depends on the move the government would make”.

The absolute lack of gravity of the response by the Finance Ministry does not give Malaysians and investors any comfort that real concrete actions will be undertaken.

It should be emphasized that this isn’t the first “warning” by Fitch Ratings. In August 2012, Fitch has already warned that Malaysia’s “fiscal trends may eventually lead to some form of negative rating action”. This means that the negative rating did not come without warning, and but as a result of complete inaction by the Government over the past year.

Of biggest concern to Fitch then was “the increasing reliance on off-balance sheet funding could potentially call into question the meaningfulness of the 55% of GDP federal debt ceiling.” The “off-balance-sheet funding” refers to Malaysia’s penchance to provide of guarantees to government-linked borrowers which does not officially count as Federal Government debt. In reality, if both official government debt and government guaranteed debt are put together, our debt to GDP ratio will be a much higher and worrying 68.9%, as opposed to the official 53.7%.

Tan Sri Mohd Irwan even went on to praise S&P (Standard and Poor’s) and Moody’s, who were apparently “willing to listen” to the Government, and hence are the “senior fellows”. Even with these 2 reports, the Secretary-General appears to fail to read between the lines which were consistent with Fitch’s statement.

The S&P in its July report, while maintaining the country’s outlook said “we may lower the ratings if the government fails to deliver reform measures to reduce its fiscal deficits and increase the country's growth prospects.” Similarly, in the Moody’s generally positive statement this month stated that “the [Malaysian] authorities have the institutional capabilities for advancing reforms, however, political willingness has been lacking”.

The Government’s penchance for listening only to the statements of praise, and contempt for those which criticise will only lead to our economic downfall.

We would like to remind the Finance Ministry of a Benjamin Franklin quote, “Geese are but Geese tho' we may think 'em Swans; and Truth will be Truth tho' it sometimes prove mortifying and distasteful”, or to quote Bill Clinton, “Our critics are our friends, they show us our faults”.

If the Finance Ministry really believes that the Fitch warning “is a concern that we share as a government and [the Government] would seek to address those concerns”, then the most important measure that he must agree to is to recognise all off-balance sheet loans and contingent liabilities as Federal Government debt in the upcoming Budget.

Only then Malaysians can see the true picture if the Najib administration has the political will to cut down our real budget deficit, instead of just providing a feel-good statistic that does not incorporate hidden debts. If Dato’ Seri Najib does not reform the budgetary process as well as cut wasteful expenditure which are hidden with off-balance sheet loans, then we fear the ultimate consequence of not just a “negative outlook” but an actual downgrade of our sovereign ratings by all three international rating agencies.

Monday, August 26, 2013

Home Minister's Tall Tale Justification to Revive Emergency Ordinance (EO)


On July 11th, the Home Minister Dato’ Seri Ahmad Zahid Hamidi claimed he will present statistics from a recent study on crime in full at the next Parliament session to justify the need to revive the Emergency Ordinance (EO), to allow the Police to place suspects under detention without trial for 2 years.

He said “I obtained the statistics, which were derived empirically, that in Selangor, 90% of organised crimes were carried out by ex-detainees who were released from Simpang Renggam where they were held under the EO. I will present the statistics and the study in the Dewan Rakyat in the coming session, the September session, to prove the need for the EO.”

When pressed again for statistics and evidence last week of his allegations on the August 17th, Dato’ Zahid Hamidi continued to insist that he had the figures in hand but urged for continued patience before making them public.

He provided the excuse that media captains need to be properly “briefed” by the home ministry and police before the government can allow any disclosure of classified crime data involving former Emergency Ordinance (EO) detainees.

Instead, it is now the Attorney-General, Tan Sri Abdul Ghani Patail himself who has provided the concrete evidence that the Minister was giving cock and bull stories to justify the reinstatement of EO-like laws.

Ghani informed a forum by the Malaysian Crime Prevention Foundation yesterday that “even after the repeal of the EO in 2011, there was no evidence from the 1,567 investigation papers submitted that violent crimes were committed by former detainees”.

The Attorney-General didn’t even tried to mince his words to say that there was “only some” or “very little” evidence of former detainees committing these crimes. He said “there was no evidence”.

Tan Sri Abdul Ghani was unapologetic in saying that the police had relied on the Emergency Ordinance (EO) to lock up suspected hardcore criminals, as they were simply "addicted to it".

Dato’ Seri Zahid Hamidi must now own up to making up ficticious claims about how 90% of organised crimes today are being carried out by ex-EO detainees. These claims never held water in the first place because if the study is already concluded, and he already have in his possession the study, why does he need to wait 2 months before the report is presented to the Parliament?

However, if you read into Dato’ Seri Zahid’s statement, one can only deduce that it is completely oxymoronic. If the “study” even exists, then surely for a shocking 90% of the crimes to be identified as being carried out by ex-detainees who were released from Simpang Renggam, these “criminals” would have been identified, arrested, investigated and possibly even charged already. But if they have been arrested and investigated – and there have been very few reports of such, then how come crime is still rampant and the Police still needs the EO?
In fact if Dato’ Seri Zahid’s allegation that 90% of these crimes were committed by former EO detainees were true, it actually doesn’t “prove the need for the EO”. On the contrary, it only proved that the police force to be totally incompetent.

Unlike Dato’ Seri Zahid who seems to have trouble coming up with concrete statistics, we have shown using past published police statistics have shown that the EO was completely ineffective in fighting rising crime. For example, the Malaysian crime index was rising rapidly from 2003 to 2008. At the peak, with the crime rate rose by 34.0% from 2004 to 2007. During this period, the EO was readily available at the Police’s disposal and yet, crime was seemingly unstoppable.

However, despite the EO repeal at the end of 2011, the Police and the Home Ministry were claiming victory in the fight against crime, with the crime index declining by 7.6% in 2012. Hence, based on the above official crime statistics presented by the Police themselves, how can the Home Minister, Dato’ Seri Zahid Hamidi, now claim that the cause of rising crime is almost entirely due to the repeal of the Emergency Ordinance?

With the damning evidence by the AG, we call upon the Home Minister to heed Dato’ Seri Najib Razak’s advice when he announced the repeal of the EO, that “now police must train themselves how to look for evidence.” Instead of just catching suspects and chucking them into EO detention, Dato’ Seri Najib asked the police to now “provide evidence to charge them in court”.

Thursday, August 22, 2013

Pihak Kementerian Enggan Menjemput Ahli Parlimen PR untuk Melawat Tapak Kerja KLIA2


Pada 20hb Ogos, Timbalan Menteri Pengangkutan Datuk Abdul Aziz Kaprawi berkata, beliau memberi jaminan dan yakin pembinaan KLIA-2 berjalan lancar seperti dijadualkan dan berpuas hati dengan kerja dilaksanakan kontraktor.

Menteri Pengangkutan Datuk Seri Hishamuddin Hussein juga telah memberikan jaminan sebelum ini bahawa lapang terbang kos rendah KLIA2 akan bermula operasi pada 2hb Mei 2014 dan tidak akan ditunda lagi.

Isu kelewatan pembinaan KLIA2 yang sepatutnya siap pada September 2011, dan peningkatan kos pembinaan daripada RM1.7 bilion sehingga memcecah RM4 bilion telah dibangkitkan oleh ahli parlimen Pakatan Rakyat sejak 2 tahun yang lalu. Jaminan sebelum ini telah diberikan oleh pihak kerajaan dan juga Malaysia Airports Holdings Berhad (MAHB) bahawa kos tidak akan meningkat dan kerja pembinaan tidak akan lewat. Akan tetapi, akhirnya, pihak MAHB terpaksa mengakui bahawa projek ini tidak dapat disiap mengikut jadual dan kos telah melonjak ke RM4 bilion.

Sejak 2 tahun yang lalu, kami telah meminta satu sesi perjumpaan dengan pihak Menteri dan lawatan ke tapak pembinaan KLIA2. Kali terakhir permintaan ini dibuat semasa parlimen bersidang pada bulan Jun dan Datuk Abdul Aziz Kaprawi telah menjawab bahawa permintaan ini akan dipertimbangkan.

Akan tetapi, sehingga hari ini, permintaan kami masih belum ditunaikan dan nampaknya pihak Menteri langsung tidak berkeyakinan bahawa projek KLIA2 dapat disiapkan seperti yang dilaporkan. Datuk Abdul Aziz Kaprawi yang telah dilantik sebagai Ketua “KLIA2 Taskforce” berkuasa untuk melibatkan pihak kami dalam satu lawatan ke tapak pembinaan untuk menghancurkan “once and for all”, kritikan daripada kami.

Tetapi nampaknya pihak kementerian langsung tidak bersifat telus dan tidak berani berbuat begitu kerana adanya udang disebalik batu yang tidak dilaporkan kepada media mengenai projek ini.

Kita dapat perhati bahawa sikap MAHB dan Kementerian selama ini adalah untuk menuding jari kepada pihak lain selama ini tanpa mengakui bahawa keputusan-keputusan MAHB untuk memindahkan tapak KLIA2 dan juga ketidakcekapan pengurusan projek telah menyebabkan penundaan projek berkali-kali.

Kesemua pihak di atas telah menafikan tuduhan daripada MAHB dan rakyat masih berkabur dan tidak mendapat kebenaran dalam skandal yang telah memakan perbelanjaan sebanyak RM4 billion ini. Akibat peningkatan kos, MAHB sekarang telah dilaporkan terpaksa meminjam lagi sebanyak RM1 bilion melalui penawaran sukuk dengan kos yang lebih tinggi.

Sikap kerahsiaan daripada MAHB dan kementerian menunjukkan bahawa segala jaminan yang diberi oleh kedua-dua pihak adalah jaminan kosong dan ada isu-isu besar yang ingin dikuburkan supaya rakyat tidak akan mengetahui kebenaran atau pihak yang bersalah tidak akan dikenakan sebarang hukuman.

Saturday, August 17, 2013

Which Part of Khairy Jamaluddin’s Statement that DAP’s Decision to Conduct Re-election is “An Admission of Guilt” is “Evidenced-based”?


In a press conference yesterday, the Minister of Youth & Sports, Khairy Jamaluddin stated that “Because I got into politics because of policy not because of politics, and I wish that our politics was evidence-based, empirically-based.” I certainly could not agree more with such sentiments.

However, it is ironical that during the very same press conference, the Minister chose to go on an unfounded political rampage against the DAP. Khairy Jamaluddin Abu Bakar has called DAP’s decision to hold a fresh central executive committee (CEC) election an “admission of guilt”.

“I don’t know why it took so long, finally they admitted they were wrong in this issue, with the decision for re-election. In fact they admitted they are wrong, (it is an) admission of guilt,” he said.
Firstly, I’d like to ask Khairy how he arrived at his “evidence-based, empirically-based” conclusion that our decision is “an admission of guilt”?

My statement yesterday on the decision stated very clearly that “to protect the gains by the DAP in its struggles over the past 45 years and in the long term interest of the party, the CEC has decided against its will, to proceed with a fresh election of the party leadership to prevent the devastating impact of a de-registration attempt by the ROS.”

In addition, I stated that “the decision to do so is in no part a concession to the incredulous accusations made of the DAP party elections such as vote-rigging with 547 phantom delegates, or the failure to notify 753 party delegates. Instead, the decision to hold fresh elections will allow our delegates to prove once-and-for-all that the Party has done absolutely no wrong.”

Where is it in any part of any DAP leaders’ statement which cause Khairy to reach his “evidence-based, empirically-based” conclusion?

Secondly, and perhaps more pertinently, the question needs to be asked as to why Khairy has chosen not to apply the same high standards of “evidence-based, empirically-based” politics to the Registrar of Societies (RoS), in the manner by which DAP is being punished?

Perhaps the UMNO Youth Chief can answer on the RoS’s behalf as to which law in the Society’s Act provides RoS the power to punish a political party for any alleged wrongdoing with “fresh elections”? As of today, DAP members and Malaysians in general are still awaiting a factual reply from the RoS on the specific law which gives RoS such arbitrary powers.

The “evidence-based, empirically-based” Minister of Youth and sports can also enlighten us as to whether the punishment meted out by RoS is a result of complaints from less than a handful of disgruntled delegates, or the failure to notify 753 delegates as widely accused by UMNO leaders, media and blogs?

Since the Minister is so certain that DAP’s decision is an “admission of guilt”, perhaps he could provide us the necessary empirical evidence since the RoS has stubbornly refused to provide the party with any proper grounds for their decision. In fact, as an “evidence-based, empirically-based” Minister, he should demand that RoS policy decisions be made based on facts instead of vicious slander and political victimisation.

If Khairy is unable to produce an iota of evidence, empirical or otherwise to prove that the DAP has breached any laws in the Societies Act, then he should immediately retract his claim that our decision is an “admission of guilt”, and to cease his attempts to score brownie points for the upcoming UMNO General Assembly by victimising the DAP with lies and slander. Otherwise, he is unfit to stake a claim on the high moral ground of wishing “that our politics was evidence-based, empirically-based”.

Under normal and routine circumstances, the DAP would not have hesitated to strike out the ROS order in the courts of law. The Party's lawyers have confirmed that the ROS has absolutely no power to "punish" a party with fresh leadership elections.

However, if the ROS can abuse its non-existent powers to demand that DAP hold fresh elections, then certain it will not hesitate to abuse the powers which it has - that is to de-register a political party - if the powers that be deem it politically expedient and necessary. We have also contemplated that any attempts to defy the unlawful ROS order via a judicial review will give "justification" to, and pretext for the ROS to de-register DAP. Hence the CEC has decided to proceed with a fresh election of the party leadership under protest, to prevent the risk of a devastating de-registration by the ROS.

Thursday, August 15, 2013

The DAP CEC Has Decided to Organise Fresh Leadership Elections Under Protest


Further to the statement issued by DAP National Chairman Karpal Singh earlier today, we would like to once again express our regret that the ROS has continued to deny DAP our rights under the law by providing a full and reasonable explanation on its orders for the party to carry out fresh CEC elections. Even not one, but two request to meet the Registrar by the Party Secretary-General, Lim Guan Eng, has been turned down curtly.

Instead, the ROS has besmirch the party with unfounded allegations that we have not been cooperative with the ROS. This is despite the fact that the DAP has complied with every single request and responded to every single query by the ROS within each stipulated period.

The DAP has to date made every attempt to obtain a reasonable explanation from the Registrar on the decision to require the DAP to hold fresh elections for the CEC. As stated previously, we repeat that the ROS has no powers under the Societies Act to demand fresh elections for the DAP and it has stubbornly refused to show us under which law they are able to take such actions.

Not only do they not want to point out which law gives them the powers to demand re-election, they have also most unjustifiably failed to provide any reasons at all as to why a fresh election is required. The only clue given by the ROS in their correspondence is that "some members were not satisfied" with the previous election. The above demonstrates without doubt the degree of unprofessionalism by the ROS in handling the matter.

Such autocratic dictats from the ROS only points to direct political interference by UMNO, and more specifically the Minister of Home Affairs, Datuk Seri Zahid Hamidi.

Under normal and routine circumstances, the DAP would not have hesitated to strike out the ROS order in the courts of law. The Party's lawyers have confirmed that the ROS has absolutely no power to "punish" a party with fresh leadership elections. On the other hand, the law states very clearly under 18C that the "Decision of political party to be final and conclusive".

The law says "the decision of a political party… shall be final and conclusive and such decision shall not be challenged, appealed against, reviewed, quashed or called in question in any court on any ground, and no court shall have jurisdiction to entertain or determine any suit, application, question or proceeding on any ground regarding the validity of such decision."

But where an insidious and wicked political agenda from the ruling political party is involved, these are certainly not normal and routine circumstances. If the ROS can abuse its non-existent powers to demand that DAP hold fresh elections, then certain it will not hesitate to abuse the powers which it has - that is to de-register a political party - if the powers that be deem it politically expedient and necessary.

The DAP CEC has last evening in an emergency meeting decided that we have exhausted all avenues barring a recourse to the Courts to seek justification for, or to reverse the ROS decision. We have also contemplated that any attempts to defy the unlawful ROS order via a judicial review will give "justification" to, and pretext for the ROS to de-register DAP. The Party is fully aware that the BN and ROS are certainly not beneath such unscrupulous actions, despite what the Prime Minister Datuk Seri Najib Razak might want to say about his "political transformation programme".

Hence to protect the gains by the DAP in its struggles over the past 45 years and in the long term interest of the party, the CEC has decided against its will, to proceed with a fresh election of the party leadership to prevent the devastating impact of a de-registration attempt by the ROS.

The decision to do so is in no part a concession to the incredulous accusations made of the DAP party elections such as vote-rigging with 547 phantom delegates, or the failure to notify 753 party delegates. Instead, the decision to hold fresh elections will allow our delegates to prove once-and-for-all that the Party has done absolutely no wrong.

As such, the CEC of 2008-2011 will meet next Thursday to follow through with preparations for the said fresh CEC election.

Monday, August 05, 2013

Dato' Seri Najib Razak Must Not Use the Excuse of the Fitch Ratings’ Revision of Malaysia’s Outlook to Negative to Impose GST


According to Bloomberg, the Government has emailed a statement to reiterate that “Malaysia remains committed to trimming the deficit to 3 percent of gross domestic product by 2015 and won’t let state debt exceed 55 percent of GDP”, and at the same time, “it still plans to reduce subsidies and broaden the tax base”. This statement was made in response to Fitch Ratings revision of Malaysia’s outlook to negative.

We call upon the Datuk Seri Najib Razak not to punish Malaysians with a Goods and Services Tax (GST) for the wastages, leakages and corruption which has caused the Malaysian government to suffer from a record 15 continuous years budget deficit and sky-rocket federal government debt.

Unlike other resource-starved countries, Malaysia is blessed with revenue from rich natural resources. According to former Prime Minister, Tun Dr Mahathir himself, Petronas has contributed up to RM426 billion as at 2009, and that sum would have increased by another RM260 billion since. Given such extraordinary contributions from the sector, with more than RM60 billion in contributions annually in recent years, Malaysia should be enjoying annual record surpluses instead of suffering from a persistent budget deficit.

In fact, Tun Dr Mahathir himself, who is also the Petronas advisor, has asked in July 2009, “what did the government spend with the RM253.6 billion payment from the national oil company over the past six years” when his successor Tun Abdullah Ahmad Badawi was prime minister.

The above is reflected by the increase in Government revenue by leaps and bounds from only RM93 billion in 2003 to an expected RM209 billion in 2013. That is a massive increase of 125% over just a decade.

The question must be asked as to why is it that despite revenues increasing so ever healthily, an envy of many nations, the BN-led Federal Government has been completely helpless in getting out of the deficit rut. The situation has deteriorated to the revision of Malaysia’s credit rating outlook to negative, which if not met with the right policy responses, will result in a disastrous downgrade.

The immediate policy by the Government it appears to be to “broaden the tax base” by implementing the much discussed GST. However, will GST help resolve the Federal Government’s deficit crisis? In the short term, of course it would. In fact, the easiest way to reduce the deficit for the Government is by increasing the taxes on every person and every product in this country. However, will such measures be just a “panadol” which give temporary relief, but fails to cure the underlying cancer in Malaysia’s public finances?

If GST is a cure, then Greece would never have gone “bankrupt”. Spain, Ireland, Portugal and Italy would not have been in financial crisis. The standard GST or value-added tax (VAT) rate in Greece is 23%. It is the same for Spain, Ireland, Portugal while it is 21% for Italy. Did the VAT or GST save these countries from a crisis arising from persistent deficits?

The answer is an obvious “no”. And if the GST couldn’t save all these nations from plunging into severe economic crisis, why should it be any different in Malaysia?

The simple reason to the above is that the GST will only postpone a crisis by boosting the revenue of the Government. However, if the Government continues to spend wastefully, run inefficiently and be embroiled in the cancer of cronyism and corruption, then no amount of taxes raised from the man-in-the-street will be able to prevent Malaysia from plunging into a crisis sooner or later.

In fact, the more the Government collects from taxes, the more leakages there will be. This correlates directly with the fact that our country’s debts have continued to accelerate despite the massive increase in government revenues, particularly from the oil and gas sectors over the past decade.

Instead of the GST becoming the ‘reform’ measure, the attempt to broaden the tax base in will fact become the hindrance to the much needed real reforms of reducing the reliance of off-balance sheet financing or contingent liabilities, enforcing open and competitive tenders for all government procurement and privatisation contracts, as well as to increase transparency at all levels of the government’s budgeting processes to fight corruption.

If the Prime Minister really believes that the Fitch warning “is a concern that we share as a government and [the Government] would seek to address those concerns”, then he must heed our call in upcoming Budget and not impose the unnecessary burden of additional taxes on ordinary Malaysians, 85% of whom still do not earn enough to qualify to pay income taxes today.