Monday, May 30, 2011

Declassify IPP Contracts Now

The Government must declassify the Independent Power Producer (IPP)agreements to justify their refusal and failure to restructure these wildly unfair contracts which allows them to make astronomical returns at the expense of the people.

Earlier in the week MCA President Datuk Seri Dr Chua Soi Lek defended the IPP purchasing power agreements (PPA) claiming that these agreements are sacrosanct and hence the Government cannot restructure these unfair agreements.

According to The Malaysian Insider, Dr Chua said “because the government is tied up in a lot of agreements, this cannot just be abolished like DAP says or Anwar (Ibrahim) says… Then Malaysia will be seen by the world as a government that does not honour its agreements. That’s wrong.”

There is little point in 'arguing' with Dr Chua on he PPA that nobody outside the Cabinet has access to. I'd instead challenge Dr Chua to prove his point that the Government completely helpless after signing he PPAs by demanding that these agreements be declassified for public scrutiny.

After the highway toll concession agreements were declassified in 2009, close scrutiny of these agreements have proven that there are well-defined terms in them which allows the Government to expropriate or buy back the concessions. The expropriation clause ensures a reasonable buy back price while ensuring that the concessionaires receives a reasonable rate if return for their investments during their years in operation. These terms were agreed and signed by both the government and he concessionaires, and hence there is no question of its sanctity being breach. Pakatan Rakyat has since been able to show that the Government is able to expropriate these highways without burdening public finances.

The declassification of the highway toll concession agreements also proved the lies of the former Works Minister Datuk Seri Samy Vellu who had for years claimed that the government would have to pay hundreds of billions of Ringgit in compensation should these contracts be terminated. He hid his arguments behind the Official Secrets Act (OSA) which prevents the public from finding out the real truth.

It is only with the declassification of the PPAs from the OSA that Dr Chua can prove that he is not another Samy Vellu who tried to protect the interest of the crony concessionaires while hiding behind the OSA.

At the same time, we have no confidence with the political will of the Barisan Nasional government's 'negotiations' with these IPPs to restructure he terms of their contracts as announced by the Minister in Prime Minister's office, Datuk Seri Idris Jala. The BN government had talked about renegotiating hgese contracts for more than 6 years now with absolutely nothing to show.

The latest announcement on renegotiations is only a meek attempt to placate an angry rakyat, and to buy more time for the IPPs which has only a few years left in their contracts to continue to profit under the current terms of their agreement.

If Najib's administration has the political will and is really sincere about renegotiating these contracts, it would not have taken him more than two years. It is only after being placed under pressure by the rakyat over the Government's attempts to cut subsidies for the man-on-the-street and not those for the large corporate cronies like the IPPs recently, that the recycled 'renegotiation' announcement was made.

The BN government must prove its commitment to transparency and accountability as promised under the Government Transformation Programme (GTP) by declassifying the PPAs and act to ensure that the people's interest comes first, as demanded under Najib's increasingly hollow 1Malaysia statement.
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