Media Statement by Tony Pua, DAP National Publicity
Secretary and Member of Parliament for Petaling Jaya Utara in Kuala Lumpur on Friday,
5 July 2013 in Kuala Lumpur
Was the Puncak Niaga Minority Shareholders Watchdog Group joking when
they claimed its Executive Chairman Tan Sri Rozali Ismail fully deserved the
RM33.4 million in fees despite the company’s losses in recent years?
I nearly fell off my chair when I read in the news
reports that the Puncak Niaga (PNHB) Minority Shareholders Watchdog Group (MSWG)
chairperson, Muhammad Imran Abdullah claimed that its Executive Chairman, Tan
Sri Rozali Ismail fully deserved his RM33.4 million payout.
He told reporters that "it was tabled at the
PNHB's annual general meeting, we approved it” and added that “we are only
concerned with our dividends and returns”, without elaborating further.
This group, which was interestingly formed
coincidentally only 1 week ago, did not seem to notice that Puncak Niaga is
under serious financial stress and has not performed well over the last 5
years.
On paper, PNHB recorded a net profit of RM233
million for the financial year 2012.
However, it should be highlighted that PNHB achieved profitability only
because it recognised a RM1,024 million “water tariff compensation” from the
Selangor State Government.
This compensation is never agreed to by the state
government because PNHB and its subsidiary, SYABAS has failed to fulfil its
obligations under the water concession agreement. The failure includes but is not limited to
SYABAS’s failure to repair and replace aging pipes, and consequently to reduce
the percentage of non-revenue water in Selangor. In fact, the “compensation” is being disputed
in court and hence should not be recognised as “revenue” for PNHB in the first
place.
Without the compensation payment, PNHB would have
made massive losses of up to RM791 million.
For the previous financial year 2011, PNHB made net
losses of RM83 million, despite recognising RM458 million in “water tariff
compensation”. Hence the total losses
without the “compensation” would have been as high as RM541 million. The above figures are found in the PNHB
Annual Report 2012, on pages 150 and 198 respectively.
Going back further, PNSB made losses of RM92
million (2010) after recognising “water tariff compensation” of RM419 million
(2010). The above figures are summarised
in the Table 1 below.
Table 1: Puncak Niaga Holdings Bhd Profits &
Water Tariff Compensation 2008-2012
|
|
2012
|
2011
|
2010
|
|
Net Profit/Loss after Tax
|
232,680,075
|
(83,130,994)
|
(91,589,556)
|
|
Water Tariff Compensation
|
1,023,940,987
|
458,150,923
|
418,717,266
|
|
Estimated Net Loss without Compensation
|
(791,260,912)
|
(541,281,917)
|
(510,306,822)
|
Therefore, without recognising the disputed and
highly controversial “water tariff compensation” from the Selangor state government,
the losses in PNHB in 2012 would have been RM250 million worse than in 2011.
As such, PNSB has been making consistent losses in
recent year and only managed to eke out a profit in 2012 purely because of a
massive increase of recognised “water tariff compensation” from less than RM500
million in prior years to a massive RM1,024 million in 2012.
Given such underlying performance in the company,
does the MSWG really believe that Tan Sri Rozali Ismail fully deserves the
RM33.4 million payoff? In fact under
normal MSWG circumstances, they should logically be calling for the company’s
top management to be axed, and not in this case, lucratively rewarded!
Or is the MSWG which was only hastily formed last
week meant to serve the interest of PNHB’s largest shareholder, and its
executive chairman in the light of an impending takeover of PNHB by the
Selangor government?
The RM33.4 million payout to Tan Sri Rozali Ismail
is a serious issue because it involves Puncak Niaga and its subsidiary, Syabas,
which have been awarded monopolistic concessions by the Barisan Nasional
governments to operate water treatment plants and to distribute water in the
state of Selangor. Water is an essential
basic utility for every single Malaysian and we are completely flabbergasted
that these concessions have been abused to outrageously enrich inidividuals who
are cronies of the BN regime.
Therefore Suruhanjaya Perkhidmatan Air Negara
(SPAN) must investigate this payout immediately and take all necessary actions
to protect the interest of Malaysians.
In fact, the Ministry of Energy, Green Technology and Water must
immediately stop all extraordinary and non-operational payouts in the water
concessionaires pending the restructuring exercise, particularly if these
companies still owe billions of ringgit to the Federal Government.
Tony Pua
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