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Friday, April 17, 2020

Keep the politicians out

Malaysiakini

“PAS has 18 MPs, eight are ministers and deputy ministers, and one has been made the prime minister’s special envoy to the Middle East. This leaves nine more MPs. Alhamdulillah, I understand all government MPs will be given the responsibility to manage Government-linked companies. This is because all of them are qualified. They are MPs.”
- PAS secretary-general Takiyuddin Hassan, who is also the de facto law minister.
Sometimes, one wonders if some of our ministers are serious in addressing issues and deciding if they are doing stand-up comedy or talking to the people on a serious note.
Depending on who is saying it and how it is delivered, there have been instances where you are compelled to laugh out loud.
De facto Law Minister Takiyuddin Hassan's (photo, above) operative phrases in these utterances are “all of them are qualified” and “they are MPs”. The people’s laughter must be echoing in the caves where he expects us - the rakyat - to be domiciled under the movement control order.
Well, the days of hoodwinking the people are over and the majority is not ready to accept, let alone buy, such ridiculous arguments. We require them to stand up to scrutiny and practise the best standards of governance. Unfortunately, Perikatan Nasional (PN) has failed miserably - at least in the six weeks since they took over Putrajaya - legitimately or through the back door.
But who made the decision to remove the incumbents in government-linked companies (GLCs) and government agencies? Was it the prime minister, the cabinet or a bunch of mavericks demanding their rewards for the 'Sheraton Move'? Or has the current PM voluntarily offered these sweeteners to consolidate his position, as suggested by certain quarters?
Do we take Takiyuddin’s reasoning as that of the cabinet or as that of the PM, with whom the buck stops? If so, the word “qualification” must be explained. Do these MPs qualify because of their academic qualifications or experience or knowledge of matters related to the GLCs?
But before making an appointment, does anyone (the PM included) consider if the person chosen is eligible or meets the requirements?
Working in tandem like 'abang-adik'
While many may argue that there are no set guidelines on such appointments, Bank Negara Malaysia (BNM) had already (as far back as August last year) prepared a set of initiatives under “corporate governance” for non-commercial banks which are classified as Development Financial Institutions (DFIs).
The six DFIs are Bank Rakyat, Bank Pembangunan Malaysia, Bank Pertanian, Bank Simpanan Nasional  and Exim Bank.

In a circular dated Aug 23, 2019, BNM sent out a set of guidelines including clauses related to the appointment and removal of directors. The DFIs were supposed to have submitted their views to BNM by Sept 23. It is not immediately known if they have come into force. Nevertheless, they appear on the BNM website.
The most important clause that stands out is: “A director of a DFI must not be an active politician.”
If the guidelines are extended to GLCs, then the whole plan to appoint MPs falls like a house of cards. BNM had wanted to act in the best interest of the banks, having learnt the harsh lessons from the BMF scandal, deposit-taking fiasco and more recently, the 1MDB debacle.
Besides, it is said that some DFIs were (in the past) compelled to provide huge loans without any security to cronies at the behest of leaders of political parties. They had talked to chairpersons and directors who probably answered “boleh di atur” (can be arranged) working in tandem like “abang-adik” (siblings).
'Fit and proper' person
BNM also set out strict criteria on appointments and proposed: “The board must establish a rigorous process for the appointment, reappointment and removal of directors. Such a process must involve the assessment of candidates against the requirements.
“Direct engagements between a candidate and the board nominations committee shall also be conducted to ascertain the suitability of each candidate for the board.”
The central bank suggested a step-by-step process on the appointment or reappointment of a director in which the board nominations committee has to comply with the applicable “fit and proper requirements”.
This committee will then submit its findings to the board, which in turn will forward its recommendations to BNM, which then carries out intense interviews and approves the candidate. In the case of non-DFIs, using the same criteria, such recommendations can be forwarded to the appropriate ministry.
Another round of interviews at ministry-level will determine if the name proposed is deemed a “fit and proper” person. That is not the end of the matter. Who decides on the remuneration? The Finance Ministry is the final arbiter on the salary package, including perks.
This is a fair, proper and transparent system where directors are chosen on merit – not assumed qualifications, unspecified special skills or favours done to the party.
This is pertinent because experience tells us incompetent people have been appointed, which not only led to poor performance but losses running into billions of ringgit. There have also been comparisons of salaries, where disparity runs into tens of thousands of dollars.

A bit of history to remind Putrajaya of some facts where, ironically, it was the then economic affairs minister Azmin Ali (above), now part of the PN government, who defended the decision not to have politicians and political appointees helm GLCs.
“That has been decided. Now, no more politicians will be appointed to any board. We want professionals to run our GLCs but, at the same time, we want the pay and allowances to be reasonable.
“We cannot provide high pay to someone to run a GLC which belongs to the government. This axing of political appointments has been done over the last few months. The salary paid must be reasonable,” Azmin was quoted as saying this to reporters at the Parliament lobby in October 2018.
He made these remarks in reference to revelations that former Treasury secretary-general Irwan Serigar’s emoluments totalled close to RM3 million between 2011 and June 2018, before his contract was terminated.
The income did not include other forms of income, such as allowances as a board member, then finance minister Lim Guan Eng said. Irwan also held non-executive, non-independent or directorial positions in 23 companies under the Minister of Finance (MOF) Incorporated.
When it was revealed that the then Malaysian Aviation Commission (Mavcom) executive chairperson Gen (Rtd) Abdullah Ahmad earned about RM85,000 a month, the cabinet directed then chief secretary to the government Ali Hamsa to review all salaries – not just of the Mavcom chairperson’s, but also the chairpersons of other statutory bodies and GLCs. Whether the directive was carried out cannot be established.
No processes to protect the taxpayers
Before that, most of the candidates for GLCs and agency positions were interviewed by the Council of Eminent persons and passed the “fit and proper person” test. Others, because of the urgency, were evaluated based on their track records. Only then were they appointed. They include Nor Farida Ariffin, Mohd Bakke Salleh, Zakri Mohd Khir and Noripah Kamso – all of whom were recently asked to resign or were sacked from their positions.
Overnight, how did someone conjure bird-brained ideas and decree that our MPs have more knowledge and experience than these personalities who have carved a niche in their respected fields?
BNM came out with its corporate governance guidelines to protect the interests of all stakeholders – the depositors, the clients and the shareholders. Shouldn’t the same be applicable to GLCs and agencies?

Why aren’t there processes to protect us – the taxpayers? Didn’t we learn from the 1MDB disaster, or is Putrajaya under the delusion that it was all a figment of the then opposition’s imagination?
With so much historical information as background, why is it so difficult for these facts to get into the heads of the current lot of ministers? Are they not aware of the dangers? Or is it simply that they want to go back to heady, albeit crooked ways, of helping their cronies make money?
Is there a necessity to reinvent the wheel? BNM has set out the guidelines and all Putrajaya has to do is to modify (not amend or make major changes) to suit the needs of the GLCs or agencies under its purview.
Is that asking too much?

R NADESWARAN is astonished that the government has not learnt its lesson when it comes to cushy, well-paying appointments for its supporters. Comments: citizen.nades22@gmail.com. - Mkini

1 comment:

  1. Put credentials aside. They must be rewarded in exchange for support given.

    ReplyDelete

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