Sailing into a sea of corruption

In one of my conversations with The Oracle of Syed Putera- we talked about the subject of corruption. Corruption is the number one problem of our country. When leaders are corrupt, they can’t transform the country. It sends the wrong signals to society. It says you can get rich easily and crooked ways are rewarding. In the longer run- it destroys the one important ingredient that makes for a progressive society- the acquisitive mindset through hard and honest work. With corruption, people can cut corners. It turns our society into marauding groups of shysters and hustlers. Already we are now experiencing some sort of a perverted Stockholm syndrome. Kidnapped victims get syok with the kidnappers. In our case, captive minds get captivated with our captors through their hustles.

We get enamored with crooks and hustlers. We induct into the committee on education celebrities and all that. Where are the serious academics and thoughtful people? Why can we induct Danny Quah into our committee if we are serious about education? But then, I quickly appease myself when I remember, we have a PM who is at home launching premium outlets as he is with public toilets.

Back to the scourge of corruption. How was it, I asked, the double tracking project originally given to China Railways which was endorsed by the cabinet was rescinded? How did it come to the state, when cabinet revised its earlier decision and in light of new ‘data and information’, the project was taken away from China Railways and given to China Harbours? Who provided new data and information? Who directed the provider of the information to submit new evidence?  

Any layman would think, China Harbours is a company expert in doing harbours and China Raiwlays in rail lines.  The proper thing is to give it to China Railways. The Oracle answered as a matter- of- factly- because huge sums of money have changed hands.

This is the number one problem of our country. Once our leadership is corrupt, it’s difficult for the leadership brought up within the same system to correct things. It will take paramount political will by a leadership and a messianic zeal to stem corruption to succeed. In our country, the only answer is a change in leadership. The present leadership has no political will and no messianic zeal. As Dr Mahathir said, the whole country, from top to bottom is corrupt. I take that to mean, Dr Mahathir also includes the PM.

Money changing hands- that’s bribery simpliciter. The businessmen who pays the aides to the PM and DPM monthly allowances, engages in bribery. The politician, who pays Najib’s people to always say good things about him so that he continues to be minister or CM, does a bribery number.

Where the money involved run into hundreds of millions and even billions, the bribery reaches a more sophisticated levels. The oracle must have meant that- manipulation of facts and figures and methods to arrive at decisions. Appointing a project management consultant that deducts points from the track record of China Harbours to make it look unqualified and extolling the virtues of another competitor. These manipulations take place. This is corruption of a more sophisticated level. It means, the level of corruption here in Malaysia, takes a network of likeminded people to work. Corruption is a team effort.

These teams are running wild in this government. This government is suffering from a serious credibility problem. Every purchase, contract and project that it dishes out is never free from suspicions of financial improprieties. Every damn business decision involving for example even GLCs or any companies linked to the government is not above shiftiness.

We haven’t got answers about allegations surrounding E&O business. We haven’t got answers behind the questionable MAS-AA deal. Mahathir wants the proton shares to be sold- but already has the buyer in mind. His method is the Henry Ford method- you can have any color as long as it’s black. Hence, you can sell to anyone as long as its DRB and Syed Mokhtar. It seems that politicians are coming out with all sorts of projects and purchases in order to make money on the side. Everyone seems to be on it. They make hay while it shines.

The number one issue of this country is corruption. Over the last 10 years, we lost over 1 trillion through illicit transfer. What does this term mean? It means precisely that- money gotten through illicit means is transferred into accounts belonging to groups of people. Perhaps one day, the identity of these people will be published so that people can get heart attacks going through the gallery of rogues.

The recent exposure of the Nataional Feedlot Centre (NFC) scandal represents yet another chapter in a seemingly unending series of gross financial irregularities. That has become the hallmark of the BN government beginning from the 1980s. These scandals always involved politicians. The BMF affair for instance was used by politicians to assassinate rivals. The main protagonists in that scandal were Dr Mahathir and Tengu Razaliegh Hamzah.

The BMF scandal, as the myth went, was linked to the finance minister then. The truth was, BBMB and its subsidiaries were all at that time, companies formed by guarantee. These were the precursors of our current GLCs and were under the direct supervision of the EPU then. The EPU was under the PM’s office and the man responsible over them was the DPM them. The DPM then was Dr Mahathir. Because Dr Mahathir had power, he remains largely unscathed by that scandal. Tengku Razaleigh in the meantime, had to expend resources and time to clear his name from the BMF scandal. He won many cases of defamation against international newspapers which tried to link him the BMF scandal. For obvious reasons his successes at clearing his name were not given wide reportage by the heavily controlled media in Malaysia.

The NFC thing involving RM 250 million, to place it in context is just a tip of the iceberg. The BN government hides a monumental submerged portion of financial excesses and rip offs. We are readying ourselves now for the exposure of the next big financial scandal. And the next.

The next possible source of financial legerdemain with the necessary ingredients of manipulations and underhand moves is certainly the cost of six offshore patrol vessels from Boustead Naval Shipyard Sdn Bhd at RM1 billion each. The cost has now increased unexplainably by another RM 3 billion. How does Boustead get into the vessel building business?

Now, the history of navy purchase of weaponry is a dismal one. So, let’s get into a little history lesson. The original contractor chosen to build Malaysia’s first generation naval vessels was PSC-Naval Dockyard. It was controlled by Amin Shah and his brothers. In 2004, it got a contract to deliver six patrol boats. It was supposed to complete the delivery in 2007. Those were supposed to be the first of 27 offshore vessels ultimately to cost RM24 billion plus the right to maintain and repair all of the country's naval craft. But only two of the barely operational patrol boats had been delivered by mid-2006. There were 298 recorded complaints about the two boats, which were also found to have 100 and 383 uncompleted items aboard them respectively.

The original RM5.35 billion contract ballooned to RM6.75 billion by January 2007. The auditor also reported that the ministry had paid out RM4.26 billion to PSC up to December 2006 although only Rm2.87 billion of work had been done, an overpayment of Rm1.39 billion, or 48 percent. In addition, Malaysia’s cabinet waived late penalties of Rm214 million.

Between December 1999, according to the Auditor General, 14 “progress payments” amounting to Rm943 million despite the fact that the auditor general could find no payment vouchers or relevant documents dealing with the payments.

How did the government explain such blatant abuses of financial discipline? On what authority was the ministry authorized to pay money for jobs not yet completely done or not even done yet? The auditor general attributed the failure to serious financial mismanagement and technical incompetence stemming from the fact that PSC had never built anything but trawlers or police boats before being given the contract.  These terms must be the world’s biggest oversimplification. Financial mismanagement is plain corruption and technical incompetence is mental deficiency.

So for corruption to take place, you must have two important elements- you must be a crook and mental dud. Why does our country find it so objectionable to kick put the crooks and the stupid?

We will now come to the construction of the SGPV- second generation patrol vessels which promises yet another roller coaster of financial rip-offs.