The purported cabinet paper posted on Malaysia Today regarding the RM12.5 billion Port Klang Free Zone (PKFZ) project puts the government in a tight spot.
This is because the classified document suggested that the government was aware of the irregularities for a long time, but never addressed them.
The 18-page document is a memorandum by the Finance Ministry in June 2007 to seek the cabinet's approval to retrospectively approve a RM4.6 billion soft loan to fund the PKFZ project.
After a Finance Ministry introduction, the document also includes comments made by the Economic Planning Unit (EPU), Transport Ministry and the Attorney-General's Chambers on the matter.
The posting of the document had incurred the wrath of Prime Minister Najib Abdul Razak who denounced the act, adding that such documents were covered by the Official Secrets Act (OSA).
However, the veracity of the document which bears the then second finance minister Nor Mohamad Yakcop's signature, has yet to be ascertained.
Support letters
Klang MP Charles Santiago, a keen observer of the PKFZ controversy, said if the document was authentic, it means that the cabinet's orders regarding the project were ignored.
Based on the AG's comments in the memorandum, Santiago said the government was also fully aware that the previous transport minister had breached regulations when issuing 'letters of support' which helped PKFZ's developers Kuala Dimensi Sdn Bhd attain AAA ratings to raise billions in bonds.
"We have asked this question in Parliament before and the (present) Transport Minister (Ong Tee Keat) replied that the letters were not 'guarantee letters'. They have misled Parliament," he said.
Santiago said the AG had noted that the 'letters of support' had given the implicit guarantee that the government was obligated to bear any liabilities, a procedure which could only be done by the Finance Ministry with cabinet approval.
In view of this, Santiago questioned the credibility of the parliament's Public Accounts Committee chairperson Azmi Khalid, who is heading the probe on PKFZ.
"Azmi was part of the cabinet that approved the soft loan. Clearly he must have known something about the irregularities in the project," he said.
'Foreign investors will lose faith'
Another PAC member and Petaling Jaya Utara MP Tony Pua, who had also scrutinised the alleged cabinet paper, said the government should have taken action against the wrongdoers instead of approving the soft loan.
"This document means that the cabinet had avoided its responsibility. They knew the problems back then but didn't take action to mitigate it and instead approved the loan retrospectively," said the DAP leader.
Meanwhile, Santiago also noted that the document did not recommend for the cabinet to improve accountability and transparency to avoid a similar scenario.
"Any foreign investor who reads this document will have no faith in our government," he said.
MK
19/09/09
This is because the classified document suggested that the government was aware of the irregularities for a long time, but never addressed them.
The 18-page document is a memorandum by the Finance Ministry in June 2007 to seek the cabinet's approval to retrospectively approve a RM4.6 billion soft loan to fund the PKFZ project.
After a Finance Ministry introduction, the document also includes comments made by the Economic Planning Unit (EPU), Transport Ministry and the Attorney-General's Chambers on the matter.
The posting of the document had incurred the wrath of Prime Minister Najib Abdul Razak who denounced the act, adding that such documents were covered by the Official Secrets Act (OSA).
However, the veracity of the document which bears the then second finance minister Nor Mohamad Yakcop's signature, has yet to be ascertained.
Support letters
Klang MP Charles Santiago, a keen observer of the PKFZ controversy, said if the document was authentic, it means that the cabinet's orders regarding the project were ignored.
Based on the AG's comments in the memorandum, Santiago said the government was also fully aware that the previous transport minister had breached regulations when issuing 'letters of support' which helped PKFZ's developers Kuala Dimensi Sdn Bhd attain AAA ratings to raise billions in bonds.
"We have asked this question in Parliament before and the (present) Transport Minister (Ong Tee Keat) replied that the letters were not 'guarantee letters'. They have misled Parliament," he said.
Santiago said the AG had noted that the 'letters of support' had given the implicit guarantee that the government was obligated to bear any liabilities, a procedure which could only be done by the Finance Ministry with cabinet approval.
In view of this, Santiago questioned the credibility of the parliament's Public Accounts Committee chairperson Azmi Khalid, who is heading the probe on PKFZ.
"Azmi was part of the cabinet that approved the soft loan. Clearly he must have known something about the irregularities in the project," he said.
'Foreign investors will lose faith'
Another PAC member and Petaling Jaya Utara MP Tony Pua, who had also scrutinised the alleged cabinet paper, said the government should have taken action against the wrongdoers instead of approving the soft loan.
"This document means that the cabinet had avoided its responsibility. They knew the problems back then but didn't take action to mitigate it and instead approved the loan retrospectively," said the DAP leader.
Meanwhile, Santiago also noted that the document did not recommend for the cabinet to improve accountability and transparency to avoid a similar scenario.
"Any foreign investor who reads this document will have no faith in our government," he said.
MK
19/09/09
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