MCA is so desperate to tarnish Penang PR's good and clean governance

MCA and its President Datuk Seri Dr Chua Soi Lek is so desperate to tarnish Penang PR’s good and clean governance that the Auditor-General Report’s certification that the Penang state government’s debt at end 2011 is even discredited. Chua had disputed Penang PR state government’s success in reducing its state debts by 95% from RM630 million in March 2008 to RM30 million at end 2011.

I had said that Penang’s success in reducing state debts was due to our success in securing a water restructuring agreement with the Federal government that was acceptable to the state government. Despite my earlier explanation, Chua had again raised the same issue in our public debates on 8 July 2012 and I had replied that the Penang PR had drove a hard bargain to protect the state’s interests, a fact that the previous BN state government could not achieve. The Federal government did not take over the water loans for free because the Penang state government had to give up our water assets.

The 95% reduction in Penang’s state debts is the highest record in Malaysia. No other states that entered into the same water agreement with the Federal government taking over their water loans, succeeded in matching Penang’s 95% reduction in state debts. Reducing state debts and recording yearly budget surpluses is clear evidence of PR’s prudent and competent financial management that places Penang in a sound financial position. If MCA does not agree, then is MCA suggesting that Penang should follow the Federal government’s increasingly higher debt burden?

At end 2007, the Federal government debts was RM266 billion. By the end of 2012, the Federal government debt has increased by 89% to RM 502.4 billion. This works out to RM18,000 each to the 28 million Malaysians. The 89% increase in the Federal government’s debts contrasts unfavorably with the reduction of the Penang state government’s debts by 95%.

The Federal government debt would be higher still if we include contingent liabilities, or loans guaranteed by the Federal government to third parties, including the private sector. The clearest example involves the comfort or guarantee letters issued by the Transport Minister relating to RM13 billion Port Klang Free Trade Zone scandal.

In a Parliamentary reply to a question by MP Dzulkefly Ahmed (PAS-Kuala Selangor) on 28th March 2012, the minister of finance stated that the amount of contingent liabilities in 2011 totalled RM117 billion. In other words, if contingent liabilites are included, Malaysia’s debts would easily exceed RM620 billion. Fortunately Penang has no contingent liabilities because the Penang state government does not guarantee any loans.

Lim Guan Eng Penang Chief Minister