Thursday, July 04, 2013

RM33.4 million Golden Parachute for Tan Sri Rozali Ismail?

Is the outrageous RM33.4 million payout to Tan Sri Rozali Ismail a pre-emptive golden handshake in anticipation of the Selangor state takeover of water concessionaires in the state?

Right-thinking Malaysians are completely outraged by the shocking RM33.4 million remuneration package for the executive chairman of Puncak Niaga Holdings Bhd and its subsidiary, Syarikat Bekalan Air Selanagor, Tan Sri Rozali Ismail.

Malaysians are outraged because Tan Sri Rozali’s companies have been awarded monopolistic concessions by the Barisan Nasional governments to operate water treatment plants and to distribute water in the state of Selangor.  Water is an essential basic utility for every single Malaysian and we are completely flabbergasted that these concessions have been abused to outrageously enrich inidividuals who are cronies of the BN regime.

As a comparison, the remuneration package of the Chief Executive Officer of Tenaga Nasional Bhd (TNB), the country’s biggest utility is only RM7 million. For the financial year 2012, TNB recorded a revenue of RM35.85 billion compared to only RM2.5 billion of Puncak Niaga Holdings Bhd.

What makes the RM33.4 million award to Tan Sri Rozali Ismail is the fact that Puncak Niaga is heavily laden with billions of ringgit of debt, and had to be bailed out by the Government repeatedly in the last few years.

Because Puncak Niaga and Syabas was unable to repay their RM1.3 billion and RM2.9 billion respectively and these debts were “taken over” by the Federal Government in 2011 in order to prevent these companies from defaulting.  Based on the 2012 Puncak Niaga financial statement, the Group has RM937 million in near-term loans and borrowings, and RM4,719 million in non-current loans and borrowings.

What is more, Puncak Niaga carries in its books a RM304 million debt to the Government due to soft loans given the its group of companies to carry out its concession obligations in the state of Selangor.  This does not include the fact that the Federal Government has also provided grants amounting to RM726 million to Syabas, including the latest RM120 million granted in January this year.

For the Selangor residents, the excessive remuneration package for Tan Sri Rozali is rubbing salt on the people’s wounds as Syabas has failed to consistently provide quality water supply and services to its consumers particularly over the past 2 years.  This year, Syabas has admitted that it has received a staggering 4,186 complaint calls daily since the start of the year as a result of constant water disruption, usually relating to poor pipe and reservoir maintenance.

We would like to question the company and the Federal Government if this RM33.4 million payout is a pre-emptive “golden handshake” payment to the Executive Chairman of Puncak Niaga in anticipation of the impending Selangor state government’s take over of water concessionaires in the state.

Since the last general election where the people of Selangor voted overwhelmingly in favour of Pakatan Rakyat despite BN using “water” as its key campaign message, it appears that the Federal Government may concede to the wishes of the people to return to water management rights to the state government.  The Selangor Menteri Besar, Tan Sri Khalid Ibrahim has announced in the Selangor State Assembly earlier this week that he has received a letter from the Prime Minister Datuk Seri Najib Razak that the latter has finally agreeed for the state to take over water concessionaires, although details are still lacking at this point of time.

We call upon Suruhanjaya Perkhidmatan Air Negara (SPAN) to investigate this payout immediately and take all necessary actions to protect the interest of Malaysians.  In fact, the Ministry of Energy, Green Technology and Water must immediately stop all extraordinary and non-operational payouts in the water concessionaires pending the restructuring exercise, particularly if these companies still owe billions of ringgit to the Federal Government.

At the same time, the Selangor State Government must deduct all inapppropriate and “unapproved” expenses, such as this RM33.4 million “durian runtuh” for Tan Sri Rozali Ismail by these concessionaires from the proposed acquisition cost of these companies.  Cronies of Barisan Nasional must not profit unfairly beyond what they have already earned to date, at the expense of the rakyat, especially under Pakatan Rakyat’s watch.
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