Whenever the Government announces huge bailouts, 2 things are certain on everyone’s mind:-
ONE: It does not matter if it is cash, guarantee or promises on paper, one way or another, at the end of the day, taxpayers will be forced to bear the cost of the bailout. Taxpayers money that could have been used more productively for development of the country now goes down the drain.
TWO: Not all of the board of directors, management and senior officers who mismanaged the company will be arrested, stripped naked of their assets and sent to jail for years. At the most, some of them may be asked to tender their resignation without any punishment and some of them will be transferred to another GLC. And since there is no severe punishment given, the incompetence and mismanagement continues.
Image source: The Edge (Billions lost in Felda, hundreds of millions of asset value vanished in Tabung Haji)
If you had put your head in the ground and not aware of the bailout, this is what was reported last week:-
Malaysian government to bail out pilgrimage fund for RM10.3 billion
The government of Malaysia will bear an RM10.3 billion ($2.48 billion) premium to restore the financial health of Lembaga Tabung Haji (LTH) as part of the pilgrimage fund’s rescue and restructuring plan, Urusharta Jamaah Sdn Bhd (UJSB) announced Thursday (Nov. 14)
In the event the value of the assets depreciates further, the losses for the government will be more than RM10.3 billion.
RM10.3 billion is a lot of money!!
Interestingly exactly last year, the CEO insisted that there is no bailout:-
It’s not a bailout, says Tabung Haji CEO
“There’s no bailout because there is no cash outlay by the government, neither is there any government guarantee on the sukuk. There is no immediate impact on the government at all,” Datuk Seri Zukri Samat tells The Edge in an interview.
Under the plan, which was unveiled last week, the SPV — to be owned by the Ministry of Finance — will acquire RM19.9 billion worth of TH’s underperforming properties and equities at book value.
In exchange, the SPV will issue RM10 billion in seven-year sukuk, which will be fully subscribed by TH, along with RM9.9 billion in Islamic redeemable convertible preference shares (RCPS-i), with no maturity or dividend.
Technically whether it is cash or not, whether it is direct or indirect involvement, the liability is on the Government. So who you want to blame for that huge loss by Tabung Haji? Who raked up losses up to RM10.3 billion? The usual bogeymen?
Perhaps the Jews?
Tabung Haji is a Government linked company to provide facilities for Malaysian’s Muslims to save for hajj. The board, management and senior officers are all exclusively Malay Muslims. It has 9.3 million depositors with revenue of RM4.2 billion and depositors fund of almost RM75 billion as at 2018.
So if Tabung Haji had very strong deposit base and a good revenue of RM4 billion, then why the Government need to bailout Tabung Haji with RM10.3 billion of taxpayers money? The only explanation is gross mismanagement, financial theft and corruption.
Manipulation and falsifying of accounts, including using Lembaga Tabung Haji (TH) money for political activities, are among reasons for the fund incurring billions in losses.
This was revealed in Parliament by Minister in the Prime Minister’s Department Datuk Seri Dr Mujahid Yusof Rawa (pic), who briefed lawmakers on the controversies surrounding TH.
“TH during the Barisan Nasional era openly and clearly falsified accounts to hide the losses it suffered,” he said, after being given permission by Speaker Datuk Mohamad Ariff Md Yusof under Standing Order 14 to address the House on Wednesday (April 10).
Mujahid said the TH’s new management also discovered more misappropriations by the previous administrators.
“The former management hid several important information that involved the 2012 sale of 25% shares in PT TH Indo Plantations,” he said.
“They also made several investments that led to losses, like in Felda Global Ventures shares that incurred losses up to RM1.1 billion.
“TH also made losses of RM670 million from its attempt to rescue Ramunia Holdings Bhd and RM144 million from buying 30% of Putrajaya Perdana’s ownership.”
Who made the decision to hide the RM10 billion losses off the financial book? Who made bad business decisions that cause Tabung Haji to incur such a huge losses?
Obviously the board of directors, management and senior officers would have been involved one way or another. Did they voice out when they noted things is not done right? Did they resign in protest? Were they concerned that they are playing with depositors’ money? Have they made accountable of these mismanagement and hiding of the facts from public scrutiny? Have they been arrested for corruption? Image source: Din Merican
And if there are no criminal elements involved, then were the company’s Risk and Compliance Department and the Internal Audit Division sleeping on the job? Was the said department’s Head of Department were demoted or sacked for failure to carry out their checking on these manipulations?
Back in October 2019, four public universities organised a gathering known as the Malay Dignity Congress – and since Malay dignity was argued to be at stake, did the organisers or participants questioned why there were huge losses by agencies like Felda and Tabung Haji? Did organisers or participants warned the Malay leaders and Malay corporate leaders from betraying people’s trust and misuse of public funds?
PAS Youth deputy chief Ahmad Fadhil Shaari even demanded that all top government positions be held only by the Malays. Wasn’t the key positions in Tabung Haji exclusively held by the Malays? Then how they managed to screw up big time? Then how they could have betrayed the trust of 9.3 million depositors and raked up losses of more than RM14 billion?
Where is the dignity of the Congress not speaking about it in the open?
As a taxpayer, I don’t want my taxes to be used to bailout GLCs that got in trouble because the management spent it recklessly like their grandfather’s money. Any taxpayers irrespective you are a Malay, Chinese, Indian or blue Martian, Muslim or Non Muslim will not agree to allow their hard earned money to be used to bailout these mismanaged GLCs. We want the actual culprits to pay for the losses that they themselves created and now want to escape from liability.
The fact is the real dignity is in slaying the real bogeyman and ensuring those who have betrayed the trust & responsibility to be severely punished, preventive actions are taken and enforced to prevent another abuse of trust and taxpayers money does not incur again.
Taxpayers should never be forced to carry the responsibility of bailing out companies that ended with huge debts and losses due to the incompetence, mismanagement and criminal acts of the past management and corrupt officers.