Abdullah cannot  wash his hands of the RM10 billion Perwaja scandal but must accept individual and  collective responsibility for one of the worst corporate scandals in the nation’s history as he had returned to the Cabinet for the past decade


Media Statement
by Lim Kit Siang

(Petaling Jaya,  Friday): The shock announcement of the cessation of operations of  Perwaja Steel Sdn. Bhd. and retrenchment of its workers has been downsized by the bigger shock of the  nonchalant attitude of the Deputy Prime Minister, Datuk Seri Abdullah Ahmad Badawi that the government will not interfere with the closure of the Perwaja Steel mills on the ground that it is a business decision.  

Abdullah cannot  wash his hands of the RM10 billion Perwaja scandal but must accept individual and collective responsibility for one of the worst corporate scandals in the nation’s history as he had returned to the Cabinet for the past decade after a four-year absence because of the UMNO power struggle in the eighties.  

Abdullah was a member of the Cabinet which in 1997 favoured Syarikat Maju Holding Bhd out of  four Perwaja rescue proposals from the corporate sector, awarding it  51 per cent stake and management control as well allowing the bumiputra group to start on a clean slate with the government assuming full responsibility for the RM2.9 billion losses and RM6.9 billion liabilities chalked up by  Perwaja.  

I had in January 1997 called on the government to present a White Paper in Parliament on the four Perwaja rescue proposals, as with the Malaysian taxpayers assuming full responsiblity for the colossal Perwaja losses of RM2.9 billion and liabilities of RM6.9 billion, the government had a duty to to explain whether it had received any proposals which were better than that proposed by Maju Holdings Sdn. Bhd involving less financial burden on the Government as well with greater promise of success in terms of having “sound capital and experience in the steel industry”, and if so, why these proposals had been rejected.

The Cabinet decision to favour  the Maju Holdings Sdn. Bhd. rescue proposal and to reject the othe three bids must now be the subject of public scrutiny with the failure of  the Maju Holdings Sdn. Bhd. rescue bid,  with the bad news of the closure of the mills and the retrenchment of the workers.  

As a member of the Cabinet which decided to hand over Perwaja to Maju Holdings Sdn. Bhd. on a clean slate, Abdullah cannot shirk responsibility for the Perwaja cessation of operations and retrenchment of workers, and I call on him and the entire Cabinet to be answerable to the Malaysian people and nation for the latest Perwaja development. 

DAP calls for a White Paper on Perwaja  to be presented in Parliament next month which should cover two important aspects: firstly, give full details of the four Perwaja rescue bids presented to the government in 1997,  why the Maju Holdings Sdn. Bhd. bid was selected and why it has now failed; and secondly, a full report on the outcome of investigations into the RM10 billion Perwaja scandal.  

In July 1999, former Deputy Prime Minister, Datuk Seri Anwar Ibrahim lodged a police report  on the Perwaja scandal making specific allegations of corruption and abuses of power and naming names. 

Since then, the Anti-Corruption Agency had made tantalising comments that it was on the verge of a breakthrough in its investigations into the Perwaja Scandal.  

It is time that the full story of the RM10 billion Perwaja scandal which parallels the two-decade administration of the Prime Minister, Datuk Seri Dr. Mahathir Mohamad, should be fully told in a White Paper to Parliament next month.

(22/2/2002)


*Lim Kit Siang - DAP National Chairman