Monday, August 15, 2011

Tajuddin Bailout: Najib Panders to Billionaire Cronies

The Prime Minister Datuk Seri Najib Abdul Razak's meek attempt to explain the withdrawal of civilian suits against Tan Sri Tajuddin Ramli as an "off-site" solution epitomises the former's complete lack of political will to fight patronage, rent-seeking and cronyism in Malaysia. In fact, the “off-site” solution by Najib suggests some secret rendezvous between the two parties to thrash out a handshake deal by subterfuge.

In his oft-quoted speech to foreign investors at the launch of his landmark New Economic Model (NEM), Najib said that "we can longer tolerate the behaviour of rent-seeking and patronage". However, the crude and blatant attempt to direct all Government Linked Companies (GLCs) to withdraw their multi-billion suits against Tajuddin to reclaim outstanding debts as well as other alleged misendeavours when he was the Chief Executive of Malaysian Airlines System (MAS) leaves a bad taste in the mouth.

The directive proves beyond doubt that Najib is not only failing to live up to his NEM promise, he is doing the complete opposite. The Prime Minister is more than tolerating behaviour of rent-seeking and patronage, he is protecting the richest cronies who have benefited from the largesse handed down by the Barisan Nasional government.

In one of the most outrageous bail outs in Malaysian history, the Malaysian government paid RM1.79 billion to acquire MAS shares belonging to Tajuddin's corporate vehicle at RM8.00 per share despite its market price then being only RM3.62 per share. In addition, gross mismanagement by Tajuddin since 1994 has resulted in MAS suffering billions in losses and was laden with RM9.5 billion in debt.

Despite MAS debts being whittled down via a "asset unbundling" exercise where Penerbangan Malaysia Bhd (PMB) was set up to acquire all MAS aircrafts and their associated debts, MAS never really recovered from Tajuddin's maladministration with its share price today struggling below RM1.80 per share.

The attempt by Najib to withdraw all suits againts Tajuddin, and to even replace all the lawyers independently appointed by the GLCs with a well-known UMNO lawyer smacks of letting Tajuddin getting away scot free.

Is Najib trying to tell us that when the respective GLCs including MAS, Telekom Malaysia, Prokhas (formerly Danaharta), many of which are listed, were poorly advised and did not know what they were doing when they filed their suits against Tajuddin?

Is the Government telling us that the existing panel of appointed lawyers, including some renown names, were wrongly advising the GLCs to claim billions of ringgit in debt and damages from Tajuddin? Were their advice so bad that they must be replaced wholesale by an UMNO lawyer?

Given the billions of ringgit in rakyat's money involved, the Government must be completely transparent in its actions and not sweep everything under the carpet. The public interest in this case is paramount and must be protected at all cost.

Najib must immediately withdraw the directive to GLCs to drop the suits againts Tajuddin because it is improper, an abuse of power and a corrupt practice to protect a billionaire crony. The Government must instead make public the case against Tajuddin to prove the Prime Minister's determination to eradicate rent-seeking behaviour, political patronage and cronyism.
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