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Media Conference Statement (2) by Lim Kit Siang in Petaling Jaya on Tuesday, 7th July 2009 at 1 pm: 

Kong Choy should answer in the PAC the five questions I asked him in Parliament in November 2007 and which he had been evading for two years about the PKFZ scandal

An online MCA website, malaysianmirror, has reported on the willingness of former Transport Minister Datuk Seri Chan Kong Choy to appear before the Public Accounts Committee (PAC) on the RM12.5 billion PKFZ scandal.

Like his predecessor Tun Dr. Ling Liong Sik, Chan should give clear-cut assurance that he will not emulate their former boss, former Prime Minister Tun Dr. Mahathir in succumbing to a sudden attack of selective amnesia when appearing before the PAC in the way Mahathir succumbed to selective amnesia when appearing before the Lingam Videotape Royal Commission of Inquiry in January 2008, where he had to say “I cannot remember” or its equivalent 14 times during his 90-minute testimony.

In his appearance before the PAC, Kong Choy should answer the five questions I posed to him in Parliament in November 2007, but which he had been evading for two years, viz:

1. Was it true that when the Port Klang Authority and the Transport Ministry insisted on buying the 1,000 acres of Pulau Indah land for PKFZ at RM25 PSF on a “willing buyer, willing seller” basis, in the face of strong objection by the Attorney-General’s Chambers and the Treasury which had recommended that the land be acquired at RM10 PSF, the Cabinet had given its approval subject to two conditions: (i) categorical assurance by the Transport Minister that the PKFZ proposal was feasible and self-financing and would not require any public funding; and (ii) that every RM100 million variation in the development costs of PKFZ would require prior Cabinet approval.

2. In the event, the first condition was breached when the PKFZ project ballooned from RM1.1 billion to RM4.6 billion requiring government intervention and bailout while the second condition was breached with the original PKFZ development costs of RM400 million ballooning to RM2.8 billion without any prior Cabinet approval ever been sought for every RM100 million increase in development costs.

3. The Transport Minister had unlawfully issued four Letters of Support to Kuala Dimensi Sdn. Bhd (KDSB), the PKFZ turnkey contractor – to raise RM4 billion bonds, which were regarded as government guarantees by the market. The Transport Minister had no such powers to issue financial guarantees committing the government, as it could only be issued by the Finance Minister and only after Cabinet approval. The first Letter of Support was issued by the former Transport Minister, Tun Dr. Ling Liong Sik on May 28, 2003, which was Liong Sik’s last day as Transport Minister while the other three were issued by Kong Choy.

4. Whether it wasn’t true that in recognition that the four unlawful “Letters of Support” of the Transport Minister had nonetheless given implicit government guarantee to the market that the Cabinet had in mid-year to give retrospective approval for the unlawful and unauthorized four Letters of Support by the Transport Ministers in the past four years creating RM4.6 billion liability for the government in the bailout of PKFZ.

5. Why no action had been taken against the Transport Minister, Liong Sik and Kong Choy, as well as the government officials responsible for the unlawful issue of the four “Letters of Support”. Kong Choy had said that he did not know that he had no power as Transport Minister to issue such Letters of Support. Was this acceptable explanation for getting the government embroiled in the RM4.6 billion PKFZ scandal?

After each question, I specifically asked Chan to give a “yes or not” answer – to deny if the facts I had mentioned were untrue, and to explain and justify what he and the government had done if what I had said was undisputed and true.

In his reply in Parliament, Chan completely ignored the five questions on the core issues of the RM12.5 billion PKFZ scandal, as well as other questions which I had posed, including:

  • How Chan could claim that he did not know that as Transport Minister he did not have the powers to issue Letters of Support which were tantamount to government guarantees in the issue of RM4 billion bonds by Kuala Dimensi Sdn. Bhd, as only the Finance Minister had such powers and also after getting prior approval by the Cabinet. How can Chan claim ignorance of this important financial principle when Chan had been Deputy Finance Minister for close to four years from Dec. 1999 to June 2003? Did Chan completely waste his close to four years as Deputy Finance Minister and learnt nothing?

  • Why Chan did not seek the advice of the Legal Adviser of the Ministry of Transport on whether he had the authority and powers to sign the Letters of Support but relied instead on advisers from outside the Ministry?

  • Why for more than three years from May 2003 to December 2006, the Finance Ministry was in the dark and completely unaware that four unauthorized Letters of Support involving RM4 billion bonds had been issued by the Transport Minister as it was only in December 2006 that the Treasury was informed by the lead arranger for the bonds that such Letters of Support had been issued by the Transport Minister and that they constituted government guarantees for the bond issues? Doesn’t this shocking evidence of a shambolic government, with the right hand not know what the left hand is doing?

I look forward to Chan answering these questions after evading them for two years when he appear before the PAC on the PKFZ scandal.

It is reported today that Port Klang Authority (PKA) has been overruled by the Finance Ministry and had been directed to resume payment of RM660 million to PKFZ turnkey developer, Kuala Dimensi Sdn. Bhd (KDSB) companies, for the PKFZ land and development.

Last Tuesday, PKA Chairman, Datuk Lee Hwa Beng had announced deferment until outcome of review by the task force commissioned to take another look at PKFZ by 10th August 2009.

I had received this information on Saturday, which was why it was my No. 106 question to Transport Minister Ong Tee Keat last Saturday.

Despite Ong’s silence, Lee’s admission of the payment of RM330 million yesterday and another RM300 million by end of the month is confirmation of the truth of the veracity of the questions I have been posing to Ong in the past 36 days. What has Ong got to say for his losing out to KDSB’s Datuk Tiong King Sing in this “test of will” between the two?

Although I had announced a three-day break of my daily “three questions a day” to Ong on the PKFZ scandal, Ong’s “cultural assassins” have continued their attacks on me.

The latest statement by Ong’s “cultural assassins” accused me of trying to deflect attention from the Penang issue of Kampong Buah Pala and Kedah Pakatan Rakyat crisis, which is so ridiculous to any Malaysian following daily news – as I started my daily “three questions a day” on PKFZ to Ong on 30th May 2009, many weeks before the two controversies in Penang and Kedah.

However, with these baseless attacks by Ong’s “cultural assassins”, I am inclined to continue my daily questioning of Ong on the PKFZ scandal. I will announce my next move on Friday.

*Lim Kit Siang, DAP Parliamentary leader & MP for Ipoh Timor



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