KUALA LUMPUR, Nov 19 – A DAP lawmaker has called on Putrajaya to explain why government development expenditure is being channelled through a little-known company owned by the Finance Ministry, Pembinaan PFI Sdn Bhd, which has also yet to file its accounts. Ong Kian Ming, who is Serdang MP, said that PFI tabled its company accounts for 2011 on June 29, 2012, and for 2012 on June 28, 2013.
But it had yet to file corporate accounts for the financial year of 2013, which meant it was almost five months late in doing so. “Is PFI trying to hide another massive growth in its liabilities in Financial Year 2013?” Ong asked in a statement today. “Is it following the footsteps of other Finance Ministry-owned companies such as SRC International and 1MDB (1Malaysia Development Berhad) and its subsidiaries in not filing their company accounts on time?”
He said that the company’s liabilities seemed to have grown at a worrying rate. At the end of 2011, PFI’s liabilities stood at RM19.9 billion; while at the end of 2012, PFI’s liabilities had grown to RM27.9 billion, an increase of RM8 billion in just one year. Ong had raised the issue of PFI’s liabilities and its “mind-boggling” multi-billion-ringgit rental deals. He accused Putrajaya of trying to conceal some RM30 billion worth of spending by PFI.
The third series of the Auditor-General’s Report 2013 showed that Pembinaan PFI had racked up liabilities of RM27.8 billion as of 2012, making it the third-largest liability among government-owned companies after Petronas and Khazanah Nasional. A report by The Edge revealed that PFI was set up to disburse RM20 billion worth of spending under the 9th Malaysian Plan (2006-2010), and that contracts under PFI would be preferably given to small-scale Bumiputera contractors.
The auditor’s report highlighted a second round of funding worth RM10 billion to PFI, of which RM7.57 billion had been set aside for 16 ministries or agencies to carry out 313 projects. The report showed that as of December 31, 2013, a total of RM4.9 billion was spent from this second tranche of funding. Yesterday, the parliamentarian urged Putrajaya to explain a “complicated” deal it had structured with PFI which sees it sub-leasing land it already owned for RM29.2 billion.
He revealed that PFI had signed an agreement with the Federal Lands Commission (FLC) where the latter would lease PFI 186 plots of land all around the country. “FLC would then sub-lease this land from PFI by paying rental for land which the FLC already owns. “In other words, the government is sub-leasing land which it itself owns by paying rental. It’s like me leasing an apartment which I already own to my wife and then sub-leasing it from her by paying her rental,” he said.