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Sakmongkol ak 47

ariff.sabri@gmail.com

Sunday, 21 November 2010

Values agenda vs. political agenda.



This PM is pushing for a values agenda. 1 Malaysia with its agenda for inclusiveness and unity is a values agenda. An economy based on merits based affirmative action is another. The weakness I think is in the execution. It's not being explained down through the ranks. That won't do, if the values driven agenda are to become shared ideals.
I wrote of the imperative of having a successful showcase. The fight and commitment to stem corruption for example must involve prosecution of those high level people who are involved. Fair play and transparency are further values that need to be shown to be believed.
For example, how can we justify helping out the financial and management mischiefs of Syabas? The people there made tons of money (I am tired of saying so many millions or billions) which they keep private. Now, because they are unable to increase the already high tariffs they want to default on their IOUs (bonds) and shift the blame onto others. They have already taken all the profits and now, they want to share the liability and losses with the public.
If the government helps out, it must clarify the basis for helping out. I hope it's not because Rozali Ismail is an UMNO member and now heads the NGO BAPAK to handle complaints from Felda settles and compete with ANAK. So Felda's problems are actually anak beranak punyak hal.
Is the federal government planning to provide a RM 1 billion bail out to Syabas or will it take over and assume the RM6 billion liabilities? You ask the consultants and they can come out with 1001 gobbledygook financial instruments to save the culprit- if they want to.
Let us remain true to a values agenda. In this agenda for example, we don't shelter cheats, crooks and the incompetents. Syabas and the water concession players in Selangor are making tons of money. Yet, they cannot stay profitable.
They are all looking at the state to bail them out. My question is why should the government bail them out? If they can't pay, let's do an open tender and see which private companies can offer the government better service and better returns.
The government shouldn't be treated as the savior of last resort. The government is not God and Santa Claus 2 in 1. The water concessionaires in Selangor shouldn't be let go scot free. They must pay for the bonds they have issued. They have made tons of money and they must be made to pay. Let their companies be taken over by other private companies. if the liabilities are be taken over too as is the normal case when another company takes over, these defaulting companies must take a haircut and it must be a crew cut.
In the name of pushing for a values agenda, I think the Najib administration should allow the free play of market forces. The defaulting companies who made tons of money should be punished in accordance to the law. Let them file for bankruptcy if they can't pay. The government should not be forced to use public money to bail out privatized businesses. Let's not see this problem as some sinister conspiracy against the water concessionaires in Selangor.
Consider the financial magnitude. The four water companies have a combined debt of RM 6.4 billion. The federal government has already given Syabas a soft loan of RM 320 million. The total interest on this 20 year loan is RM 250 million, and Syabas will not be required to pay a single sen of this amount. Instead, this cost will be fully borne by Malaysian taxpayers.
Puncak Niaga Sdn Bhd (PNSB)'s net debt is RM1.3 billion, Syabas's is RM2.9 billion, Splash's (Syarikat Pengeluaran Air Sungai Selangor Sdn Bhd) is RM1.6 billion and Konsortium ABASS is RM640 million. The total is RM6.4 billion.
The Syabas people cannot run to the federal government and say they are in this predicament because the state government refuses to allow them to increase the water tariff in the state. On what reasons can they justify the increase?
I think we should learn how a smaller outfit such as Perbadanan Bekalan Air Pulau Pinang can make money on lower rates and on smaller revenue. The Selangor state companies which supply more water and on higher tariffs cannot?
They cannot simply because, the companies may not be run efficiently or that the woes of JBA Selangor before the utility supplier was privatized are not tackled. Leakages and losses and sheer mismanagement. And the list of mismanagement included; - as a matter of public record, an audit report on Syabas which showed more than 72% of contracts, worth RM 600 million in total, was awarded to companies chosen through direct negotiation not by open tender process. Also, RM 325 million was found to be 'missing' in discrepancies between Syabas' public accounts and the records of contracts awarded from 2005 to 2007.
In June 2005, Syabas contravened the terms of their concession when they imported RM 375 million worth of pipes from an Indonesian company instead of sourcing them locally. The Indonesian company was owned by Tan Sri Rozali Ismail, the CEO of Syabas.
In the face of these shenanigans why should we expect any decent government to not allow Syabas from raising water tariffs by 37%?
But at the same time, why should the state itself now endeavoring to reacquire all water concessions from the private water companies?

 

 

19 comments:

Anonymous,  21 November 2010 at 21:23  

Salam SAK,

Tak yah kita hayun these concepts atas angin nih. Rakyat boring la beb. Suroh org2 BN semua return balik semua khazanah yang dah kena songlap. Billions of dollars beb. If it has reached a trillion by now I am not surprised. Peka kat situ pun cukup. Those monies can be used for us rakyat biasa nih bukan enrich a selected few.

OneMalaysian,  21 November 2010 at 21:54  

Dear Sakmongkol

“My question is why should the government bail them out? If they can't pay, let's do an open tender and see which private companies can offer the government better service and better returns”.

You are asking all the right questions. The government – state and federal - by contrast, has been doing all the wrong things and continues in this mode. You might ask, why is this happening in so many cases?

The reason, as has been mentioned so often in your blog, is due to cronyism. These cronies are mostly Malays, but they sometimes work hand in hand with Chinese cronies (cronies of cronies). These people get unbelievably sweet terms, which are essentially one-way bets. They stand a chance to make lots of money, but if the project crumbles, or is run into the ground, then the government comes in to bail them out. And the “revitalized” project is given to another crony, and sometimes the same one! MAS was a good example when it was owned and run by Tajuddin Ramli.

As for these water companies in Selangor, Puncak Niaga is a very good example of projects going to people who knows nothings of managing water companies, but who knows everything about political connections. Rozali Ismail was a nobody-lawyer in 1993 when he was awarded the Puncak Niaga water project. He had consultants draw up the privatization proposal, and Mat Tiab who was the MB of Selangor then just gave it to him on what was considered very good terms. (Rozali was at that time Selangor UMNO Youth Teasurer or holding some post like that and was very close to Mat Tiab, too close some say). Puncak Niaga went public through a “back-door” listing. This sweet heart deal had a cost “pass through” clause. This means that if there are any increases in materials, the increases are passed on and there would be a rate adjustment. Now, even with such a deal, a no-brainer deal really, he managed to screw it up. So much for competence. And you are right about the supply of pipes. Instead of buying cheaper local pipes, he bought from his own company in Indonesia. Why? Because by doing so at very high prices he had milked Puncak Niaga upfront by taking massive profits on the cost of capital expenditure incurred by Puncak Niaga. This means the capital costs incurred by PN is very high and therefore it becomes less profitable. The pipes profits went into his own pocket.

You want to talk about a values agenda? Then the government must be prepared to wipe out cronyism. Will it if this also means that many Malays who are close to powerful UMNO politicians are deprived of “economic” opportunities, and worse, in open competition/bidding the winners are non-Bumiputra companies? Can UMNO and the BN government handle the political fall out? And will this affect their political funding – kick-backs from cronies – that help to keep the ruling parties in government?

donplaypuks® 21 November 2010 at 22:32  

You are absolutely right. The Govt should let the market sort out the Water Cos and let the bondholders take a haircut where necessary in Selangor.

The Water Cos and their leaders have take the Selangor consumer for a massive ride! Which household in Selangor does not have 2 or 3 water filters installed and still boil the water for safe consumption?

There is a thing in M'sia called the Bond Mafia who, every time they face a haircut, will squeal like pigs for Govt bailout. It happened with YTL (your favourite co) who talked about the 'sanctity of Govt contracts' when they were faced with the threat of rengotiating the IPP sweeetheart contracts, again when PKFZ was in danger of defaulting on its loans and now it's the Water Cos.

When Najib became PM he promised that open tender would be the order of the day and as Shakespeare said 'it is a custom more honoured in the breach than in the observance.'

We should have a simple rule - no open tender, no Govt bailout!

dpp
we are all of 1 Race, the Human Race

Anonymous,  21 November 2010 at 23:19  

Tuan Pemblog,

Isu ini dibidas oleh pembangkang sebagai melindungi pihak kroni. Kalau gagal ditangkis atau dilibas kembali maka kesannya bukanlah sedikit.

Nampaknya hanyak Pak Sak saja yang benar-benar berpijak atas bumi yang nyata dengan menyentuh isu yang ada kaitan dengan politik semasa.

Yang lain-lainnya hanya sibuk menyelak isu kronisma yang ada dalam kain sendiri walhal isu berkenaan telah berlalu yakni tidak relevan dalam konteks semasa.

Mungkin yang lain-lain itu beranggapan 'pukul anak sindir orang lama'(ia itu isu lapuk) lebih utama dan dapat mengalihkan tumpuan umum terhadap isu semasa.

Strategi membuka pekung di dada si bapa bagi menyindir si anak mungkin memuaskan hati sendiri tetapi dalam masa yang sama ia langsung tidak mengalihkan pandangan rakyat terhadap isu yang lebih utama dan kritikal.

Pemerhati Kecil

Anonymous,  22 November 2010 at 09:01  

You are just like a wife who remain faithful to a husband who is a philanderer,a compulsive womanizer , a cheat and.
Of course this husband is UMNO.

This steadfast love for UMNO will deplete your patience and increase your blood pressure.

Anonymous,  22 November 2010 at 09:18  

Dear Dato Sak,
you have put the country's predicament of gross mismanagement in a nutshell:

"The fight and commitment to stem corruption for example must involve prosecution of those high level people who are involved. Fair play and transparency are further values that need to be shown to be believed."

If BN wants to win the next election, do not prevaricate or delay taking action against companies like Syabas and the rest of the water gang!

Sometimes people have short memories because they are sweetened by handouts of trifles or goodies by the govt, but when it is hurting their pockets, then beware of elephant memories!

sincerely,
PowerOn

Anonymous,  22 November 2010 at 09:43  

Dato,

'Now, because they are unable to increase the already high tariffs they want to default on their IOUs (bonds) and shift the blame onto others. They have already taken all the profits and now, they want to share the liability and losses with the public.'

Sound familiar?

This scheme started with Bank Bumiputra, then UEM/Renong with MAS in towed, follow with PKFZ scandals.

The people, behind these have perfect the same model via countless executions, with the govt's knowingly help!

So can Asas Serba do the same?

U bet. Remember, they come from the same mold & the govt wont let the 'self-made' Malay tycoons failed - for the sake of the race's face & ego.

One might argued that there r many Malay tycoon failures to prove the govt's off-handedness. BUT how many ever wonder did these so-called race champions actually 'failed' mischievously or retired happily after the so called national services?

walla 22 November 2010 at 11:25  

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Anonymous,  22 November 2010 at 11:51  

Dato SAK,

Your comments on Syabas are timely.
Let me relate my little experience in dealing Syabas as a water consumer. I am chairman of a condominium which has been facing problems with syabas since more than 10 years ago.
Without going into the details of our problems for the last 10 years, let me state in simple terms the problem our condo faces. Syabas refuses to read our condo's approved water meter in order to bill the condo and its residents but bills a private water pump meter run by a "Joint Venture Consortium or JVA" which is in tha name of a private individual. and the private individual the bills the condo and all other consumers whose water supply come through this pump which is on private proerty property.
As chairman of the condo's Management Council we initially wrote to Syabas and held many meetings with them. We even wrote to DBKL to intervene. they wrote to syabas and nothing happened. All to no avail. We then wrote to SPAN, the national water regulator to intervene in the matter. Its been more than 6 months since SPAN called a meeting of all parties affected and to date nothings has happened. All we wanted was for Syabas to read our legitimate water meter located within the condo land. The condo has been issued with strata titles to prove everything is legitimate. And yet Syabas refuese to read our water meter and bill us directly.
We have reached a stage where the condo MC is seriously considering going to the High Court to force Syabas to bill us, as required under the water laws, where there is a legitimate meter installed.
This leads to the question of the role of BN and its elected reps. Are they there to represent us or what? do you think they deserve our votes?

OneMalaysian,  22 November 2010 at 12:40  

Dear Sakmongkol

This topic of values agenda vs political agenda is too important to leave alone without further comment on a broader basis.

When we talk about “values”, what exactly do we mean? Do values refer merely to moral values, such as honest work for honest pay, clean and efficient government without zero tolerance for corruption, a society largely free from discrimination based on race and religion, personal honour in public servants and politicians? Or do we also include economic values such as free competition, transparency of processes and governance in public tenders and procurement, social duty and responsibility of government in matters of taxation and social welfare?

If we aspire to an enlightened, free, prosperous, culturally rich and fair society, then we must incorporate the best values of morality in our society. We must also free up the economy for open competition for the best ideas to surface and be prepared to reward the most able and hard working among our citizens. These are the people who drive the economy, who create wealth, and it would be plainly unfair and self-defeating that we place obstacles in their way. When we do that these talents simply leave our shores and benefit other countries. It is as wise as excluding the best players in our football or badminton or hockey teams (replacing them with second rate players chosen on dubious criteria) and hope to have any realistic chance of doing well in international competitions. And so it is in economic management. If we want to be a richer country we must not only nurture talent but also allow it to flourish unhindered.

We can be confident that if we ask Malaysians individually what our country needs in its values agenda, they will say the very same things that I have said above. However, the moment politics is mentioned, the answer changes. Exceptions to good practices and values replace the “good” values. Compromises creep in. In the end we collectively do what we should not do, but in the name of political expedience it is done. Politicians are good at this. Which one amongst them is prepared for the long haul to make this country better? That requires them to take short and medium term unpopular stands, and most are not prepared to do that.

We cannot hope to progress based on the vision of politicians. They don’t have any. In Malaysia we can see that politicians are generally personally richer at the end of their political careers than when they started. This says something. The run-of-the-mill politician is not in politics for altruistic reasons. This country can only fulfill its true potential if we have a visionary statesman pushing a values agenda. That is the only way forward. This present government does not have the courage to go down that route, although the NEM is a pretty good road map.

d'enricher 22 November 2010 at 13:14  

Dato'

Return it back to the people of Selangor at a fair price, since as you say, they already makes the tons of money.

Like it or not, its better for the rakyat of Selangor, and Tan Sri Khalid can make it work. PNB was on strong footing, isn't it.

If another company, they will still wants to make money. If be4 March 08, Khir Toyo privatised it to Tan Sri Rozali who is not a water expert except for the knowledge of drinking or washing with it, whats the big deal.

If the Project "Selamatkan Selangor" is successful, maybe the new MB can make it work better, or sell it off again.

For me, I am willing to return the "free water" allocation if the state gov't create a special fund for the betterment of the rakyat of Selangor.

To PM Najib and the Minister incharge of water, pls support Tan Sri Khalid and give us our water right.

A.Alshukor

Anonymous,  22 November 2010 at 13:18  

Dato',

Could you PLEASE educate your fellow UMNO guys that income/wealth/proceeds which are haram would remain haram, no matter how or where it is spent? Using such ill-gotten gains and spending it on the family home or even the children's education fees does not take away the haram taint/stink. I mean, the classic modus operandi for these types of people would be to start from the bottom such as a pekerja am majlis daerah or maljlis perbandaran, get themselves aligned to any UMNO warlord, and steal a few crumbs from the rich man's table and Voila! Full speed ahead!! It is pathetic to read about these orang kaya baru (new money) with hardly any expertise or even substance let alone ethics. It is even more pathetic to look at their family members who either are not aware or simply put a blind eye to the haram money.

PH Chin 22 November 2010 at 16:09  

Dato'

Sadly the powers-that-be are still trapped in the political agenda.

Why should the tax payers, especially those outside Selangor, made to pay for mismanagement of Puncak Niaga, Syabas, Splash and Konsortium ABASS ?

Our tax monies can be best utilised to help the hardcore poor and the needy.

Anonymous,  22 November 2010 at 18:01  

Queit Despair... This one is for you.

Selangor water run by ?????

Penang run by DAP.

Penang made money. Selangor??

Hehehehe your friends you admire sooo much siding the cronies and charge the rakyat.


When come to costs... charge it. Whe it comes to income ... pocket it.
When it comes to bankcurpcy by the company (not them rick cronies)get rakyat's money.

Where in the world can you find such good business to run? In Bolehland by friends of ???

Anonymous,  22 November 2010 at 19:57  

Salam Dato

Sometimes you just remind me of the "Battered Wife Syndrome". Time and time again, you (also a member of the Rakyat) get battered...bruised..assaulted..and yet you remain in the relationship (with UMNO).

You deserved credit nonetheless as you the only UMNO blogger who's fearless in calling a spade a spade. All the other UMNO Bloggers are no better..but I guess they want to "cari makan".

Anonymous,  23 November 2010 at 00:33  

now i am in power, it's my right to plunder. next changes when u in power, it's your right to plunder.

fair and square. woolah.

Anonymous,  23 November 2010 at 02:06  

I smell the dirty hands of Mat Txxb and Khir Txxo, plus the hidden dirty hands of some UMNO leaders and cronies in the cookie jar...

sri hartamas

Anonymous,  23 November 2010 at 14:44  

Salam Semua,
Kelemahan terletak kepada orang yg melaksanakannya. Masalah timbul kerana nafsu mengatasi segalanya. Tindakan yg diambil tidak bercirikan sebagai seorang beragama Islam. Masing2 tamak haloba sehingga lupakan akhirat. Kalau mau transformasi / perubahan, then we should go back to basic teaching of Islam in all aspects. This involves semua ibubapak dan anak including government people. Kalau tidak, we can just forget about 1Malaysia, 1Transformasi or whatever 1 and not forgeting Wawasan2020.

Anonymous,  23 November 2010 at 18:49  

Dato'

Im a fan of your thoughts and the manner in which U articulate them. Since your thoughts are clear, U can defend your position, whatever it is.

Another good article. If more BN people start saying the things that U do, BN has hope again.

Rgds

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