Saturday, July 24, 2010

Umno Cronies Pocket Hurt

Umno offensives against the Selangor state government caused by Umno cronies who could no longer line their pockets

The Umno Selangor leaders such as Datuk Seri Dr Mohd Khir Toyo and Datuk Noh Omar who are trying to outdo each other in maligning the Selangor state administration over some of its key policies. Even the Deputy Prime Minister, Tan Sri Muhyiddin Yassin has put his foot in, accusing the state of mismanagement especially with regards to the issue of sand mining and the provision of water services in Selangor.

Their motivations cannot be clearer when one doesn't see any Umno leader berating Datuk Abdul Ghani Othman's Johor administration where the worst cases of illegal sand-mining and sand-smuggling occurs despite the fact that these issues have been widely highlighted by the media.

What is more, Tan Sri Muhyiddin Yassin had the cheek to tick off Selangor Menteri Besar, Tan Sri Khalid Ibrahim over his determination maintain water tariffs and improve the quality of water services in the latter's dispute with SYABAS, a subsidiary of Umno-linked Puncak Niaga Holdings Bhd. This is despite the fact that his the Deputy Prime Minister's own home state of Johor had suffered the highest water tariffs in the entire country post-water privatisation, while at the same time having to endure severe water shortages rationing in major townships such as Kluang and Batu Pahat as recent as months ago.

The reasons for the above are crystal clear. The determination of the state government to reduce patronage and corruption, maximize government revenue and to improve the quality of public services without increasing the financial burden of the rakyat is hurting the pockets of the Umno cronies in Selangor who are used to the ways of Barisan Nasional.

The Selangor state government vehicle, Kumpulan Semesta Sdn Bhd (KSSB) today manage the issuance of permits for sand-mining in the state. For every sand mine, genuine operators obtain their permits via open tenders or requests for quotations where direct negotiations are no longer entertained. As such, “Ali-baba” licensees under the previous regime who reaped easy profits by securing the permits via patronage and subsequently subcontracting the actual mining work for quick and easy profits are no longer viable as they'll either be disqualified or outbidded by genuine operators. This has obviously attracted a fair and vocal share of detractors who are critical of KSSB as the new system is now more competitive and transparent.

In addition, more stringent processes and enforcement has resulted in lower leakages via under-declaration of sand mined, and consequently increased the revenues of the state government by leaps and bounds. In fact the total royalty and profits before taxation accrued to both the state and its subsidiary, KSSB have increased from RM4.39 million in 2007 under BN to RM8.17 million or by 86.1% in 2008, under Pakatan Rakyat's 9 months of administration. This increased further to RM13.76 million or a phenomemal 213% in 2009. For the first half of 2010 alone, the state has already collected RM15.3 million or on track towards achieving 500% increase for the full-year. See Chart 1 below for details.


Chart 1: Royalties collected by Selangor for sand-mining 2005-2010

The figures speak for themselves, which are a result of a competent, accountable and transparent state administration. The rising income has been used to finance the state government's welfare schemes for the people.

Similarly for the water issues harped by Tan Sri Muhyiddin Yassin and more recently by Datuk Noh Omar, Tan Sri Khalid Ibrahim has remained steadfast in refusing to cow to the arm-twisting tactics of Umno-linked Puncak Niaga Holdings Bhd, backed by the Umno-led Federal Government. The latter entities have sought to substantially and unreasonably increase water tariffs by up to 37% for Selangor consumers and have to date refused to accept the state's proposal to consolidate the water industry which will result not only in lower tariffs but also better quality services. Instead they chose to attack the state administration of mismanagement of water resources just because the state offers 20m3 of water for free monthly to assist to poor and needy in the state.

The Deputy Prime Minister, Selangor Deputy Liaison Chief, Datuk Noh Omar and Selangor Opposition Leader, Datuk Seri Mohd Khir Toyo are clearly acting as the angry voice of the Umno cronies in an attempt to destabilise the state government and take revenge for Pakatan Rakyat policies which put the welfare of the rakyat first.

Tan Sri Muhyiddin should instead tell the party's cronies that they could no longer expect free lunches and easy money, but instead get rid of their “subsidy mentality” of expecting handouts from the Government. After all, if the rakyat are expected to stomach the multiple price hikes due to subsidy cuts, then surely the Umno cronies who have profited lucratively all these years can perhaps learn to be competitive for once.
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