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 On Saturday, Tengku Razaleigh Hamzah spilled the beans on some of the ways in which corruption was carried out and money changed hands in Malaysia.
In his speech at the book launch of ‘The Shafee Yahaya Story – Estate Boy to ACA Chief’, Razaleigh said corruption appears to have its root cause in our political parties. He identified some of the most prominent areas as tender inflation, the refurbishment of defence equipment and government procurement.
This is not the first, and I hope not the last time that the former finance minister speaks plainly on how our political system has broken down in a way that cannot be salvaged by piecemeal reform, how our public institutions have become corrupt, biased and inefficient because of money and politics (most disturbingly by racial politics), and how our economy has stagnated.
Another minister, this one in the current cabinet – the political novice Idris Jala – let the cat out of the bag that Malaysia faced bankruptcy if its finances should continue to be mismanaged.
Against this backdrop, the clock is fast ticking to 2020. Less than 10 years away is our Vision 2020 dream to be a fully developed country in all respects.
However, unless some very definite action is taken on the political front, not only will we fail to reach the status of a successful nation even as defined by narrow economic measurements such as the GDP (which incidentally gives no clue on how income is distributed) we could well become a failed state in other important respects.
Corruption will be our downfall
Razaleigh’s proposition that corruption is “the single biggest threat to our nation” is worth repeating. “In our economy, corruption is the root of our inability to make the economic leap that we know we are capable of,” he lamented.
He had similarly opined in March that “confidence is at an all time low” and the country was suffering from “debilitating levels of brain and capital drain”. In other words, human capital and financial capital are fleeing the country.
I have written before about Razaleigh’s keynote address to the Perak Academy where he spoke on what I called his ‘10 Golden Political Principles’ (see my earlier article). He reiterated some of the points he made earlier in Ipoh once again in his speech five days ago.
In discussions on the subject with many friends, we reached a consensus that the principles highlighted by Razaleigh are relevant to meeting the challenges of the present and future, and deserving of full support from thinking Malaysians.
Here, I would like to elaborate on No.4 of Razaleigh’s 10-principle primer. The fourth principle reads “It shall be the duty of all political parties to adhere to the objectives of public service and refrain from involvement in business, and ensure the separation of business from political parties.” Coalition politics is business is politics
The political parties in the ruling coalition are not merely involved in business; they appear to have their finger in every juicy pie, from organizing Monsoon Cups to building ports in Klang to the compulsory medical examination of foreign maids and the pasting of holograms on medical products.
In his groundbreaking disclosure, Razaleigh talked about how the coterie enjoying political patronage sees it as an entitlement to “take their slice of the project”.
He said: “By the time they and each person down the line all the way down to the contractor takes a lot and there is not enough left to do a decent job, bridges collapse, highways crack, stadiums collapse, hospitals run out of medicine, schoolchildren are cheated in their textbooks.”
Regardless of official denials and mainstream media spin, what is common knowledge is clearly there for everyone to see – the submarines that cannot dive, the stadium roof that caved in, the cracks in public infrastructure and the price paid for in human lives.
Last October, some 300 children had attended a 1Malaysia camp organized by the Kinta Barat district education office. Three Indian primary school pupils at the camp drowned in Sungai Kampar when the suspension bridge they were crossing suddenly gave way. The bridge was then just two weeks old.
Klang MP Charles Santiago alleged that the company that contributed the bridge was either ‘repaying’ for a lucrative contract awarded by some politician by building a shoddy bridge, or the contract was awarded to an irresponsible company through ‘crony connections’.”
“Government contracts circulate among a small group of people,” Razaleigh had commented on the situation in general in his book launch speech. He pinpointed that “politicians are the villains in this piece”, i.e. politicians are the ones most implicated in the scourge of corruption and its percolation at all levels.
If we want to improve the country’s economy and our own economic wellbeing, we have to tackle corruption. In order to eradicate corruption, we have to tackle the politics enabling it. And if the core group is as small as Razaleigh implies, then it should not be all that difficult to close the net on the several most influential individuals. Who has benefited from mega contracts?
To return to the fourth principle that politicians and political parties should refrain from involvement in business, it should be asked also if they acquired the business through undue political influence, at discounted cost and under questionable terms.
For starters, here are two cases that the MACC can look into. Perimekar
 A company called Perimekar was created in 2001 and very shortly thereafter was paid almost RM500 million for “coordination and support services” during the Scorpene submarine purchase negotiations. Perimekar is owned by KS Ombak Laut Sdn Bhd of which the principal shareholder is Mazlinda Makhzan, (left) wife to Razak Baginda.
It is claimed that Perimekar was “involved in the marketing, upgrading, maintenance and related services for the Malaysian maritime defence industry”. The connection between Perimekar and politicians, political parties and the Ministry of Defence should be investigated.
There are no indications that Perimekar was qualified for the job or of there being any necessity even for such a lucrative job of ‘marketing’ our (by rights top secret) “maritime defence industry”.
Mastek Sdn Bhd & Scomi
 Then there is the company embroiled in what came to be dubbed the ‘oil-for-food’ scam in Iraq. Seputeh MP Teresa Kok had posed a question to the Minister of Foreign Affairs in Parliament on June 29, 2006 as to why the government had not taken any action against Mastek Sdn Bhd.
Teresa said US$10 million had been given [as kickback] to the Saddam Hussein regime as stated in the United Nations Committee of Enquiry report on Oct 27, 2005. She asked if the ‘no further action’ was because “Mastek is owned by the in-laws of Noor Asiah Mahmood and Faek Ahmad Shareef”?*
Noor Asiah is the sister of Abdullah Badawi’s late wife Endon Mahmood, while Faek an Iraqi immigrant with familial ties by marriage too. If the separation of business from political parties is to be ensured, didn’t the fact of Abdullah Badawi’s sister-in-law getting a UN contract pose a conflict of interest?
Or for that matter the Polis Di-Raja Malaysia clearing Scomi Precision Engineering of charges of involvement in an “alleged nuclear proliferation network” when it is Abdullah’s son Kamaluddin who is the man behind Scomi?
I do not believe there has been a definitive closure to the episodes above in terms of ascertaining how political patronage has been brought to bear upon business transactions.
If the MACC is reluctant to open any file on the two companies, then the opposition front should take the initiative of collecting the evidence. The opposition has many lawyers among its leaders; it can file a civil suit to bring the cases to court.
********************************** * Dewan Rakyat, Aturan urusan mesyuarat, Naskhah sahih/Bahasa Malaysia
Hari Khamis, 29 Jun 2006, pukul 10.00 pagi
Bil. 39
Pertanyaan-Pertanyaan Bagi Jawab Lisanpr-1123-L5343 Puan Teresa Kok Suh Sim [Seputeh] minta Menteri Luar Negeri menyatakan kenapakah Kerajaan masih belum mengambil tindakan terhadap Mastek Sdn. Bhd. yang telah memberi US$10 juta kepada rejim Saddam Hussein sebagaimana yang dinyatakan dalam laporan Jawatankuasa Inkuiri Bebas Bangsa-bangsa Bersatu pada 27 Oktober 2005. Apakah ini kerana syarikat tersebut dipunyai oleh keluarga mertua Noor Asiah Mahmood dan Faek Ahmad Shareef.
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A very good and eye opener for those who have not read about how money were spent for the submarines.
However, I wish to highlight the fact that when Ku Li was an UMNO Vice President in the 1980s, his bid for the UMNO Deputy President post against Musa Hitam in 1981 and 1984 brings about begining of the huge amount of money spent in UMNO election campaign.
During the Shahrir's campaign as an independent for the Johor Baharu parlimentary seat in the 1980s, Musa Hitam released a letter that he wrote to Tun Mahathir complaining to Tun Mahathir requesting for Ku Li to be dropped from the cabinet after the 1984 Deputy President fight. In his letter, Musa Hitam argued that "he does not have the financial muscle to compete against Ku Li should he be challenged again in the next UMNO election". That tells us how much money were spent in the UMNO election campaigns.
I am pointing this to remind readers that the 1980s was the time when campaigning for positions in UMNO require huge financial resources that "needs replenishing" after the position is won. That is also one of the reason for the greed and corruption that occurred in the 1990s where there are so many UMNO state assemblyment who are able to build huge mansions after only serving one or two terms as State EXCO members despite earning meager salary and allowances.