EPF gave RM21.16 billion to govt-owned Pembinaan PFI

In a statement, EPF says the money was used as capital to fund development projects identified by Putrajaya.

EPF says all sources of repayments for the funding are from the government and are currently in order.

PETALING JAYA: The Employees Provident Fund (EPF) has clarified that it provided RM21.16 billion funding to the government-owned Pembinaan PFI Sdn Bhd, which was to be used as capital to fund development projects identified by Putrajaya.

In a statement today, it said the financing was within the EPF’s risk-return profile and a comprehensive documentation process was conducted to ensure that the basis of the investment was fair and reasonable.

“All source of repayments are from the government and are currently in order,” it said.

The EPF has also assured that all investment decisions conform to the EPF’s mandate to protect members’ savings and interest.

The EPF statement follows postings being shared on WhatsApp expressing fears that money provided to Pembinaan PFI was in danger of becoming another 1MDB affair.

In 2015, the Edge Financial Daily had quoted then Serdang MP Ong Kian Ming as saying a little-known company owned by the finance ministry, Pembinaan PFI Sdn Bhd, had recorded RM27.9 billion in debts at the end of 2012. Ong said the amount could have reached RM47.4 billion at the end of 2014.

In a statement, he had added that the spending of Pembinaan PFI did not appear anywhere in any of the federal government’s budget accounts and this meant all its expenditure was for “off-budget” items.

The report further said the company’s debts were listed as part of the federal government’s contingent liabilities.

“Without accountability on how Pembinaan PFI is spending its borrowings, transparency on how it is servicing its debts, and vigilance from finance minister and prime minister Najib Razak, the company can easily turn into another 1MDB,” Ong had said then.

Pembinaan PFI is 99.9% owned by Minister of Finance Inc. The Federal Land Commissioner (FLC) holds one share in Pembinaan PFI.

The Edge Financial Daily report further said that the Auditor-General’s (AG) Report in 2013 (series 3) stated that PFI had the third-highest liabilities among all government-owned entities at the end of 2012.

Its total liabilities were RM27.9 billion, behind two well-known companies with huge assets, revenues and profits — namely Petroliam Nasional Bhd (Petronas) (RM152 billion) and Khazanah Nasional Bhd (RM69 billion), the report stated. -FMT