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KUALA LUMPUR, April 1 — Putrajaya confirmed today that the little known Finance Ministry-owned Pembinaan PFI Sdn Bhd currently still has an outstanding debt worth nearly RM27 billion.
In a written reply to Serdang MP Ong Kian Ming yesterday, the ministry said that PPFI’s audited financial statement for the 2013 financial year was submitted to the Companies Commission of Malaysia (SSM) on March 4 last month and confirmed a debt of RM26,609.6 billion.
“For your information, PPFI is a Special Purpose Vehicle (SPV) fully-owned by the Finance Ministry Incorporated, formed on September 28 2006.
“The purpose for the company’s foundation is to obtain funding for development purposes and other programmes identified by the government,” the ministry said.
Ong had asked the ministry to state PPFI’s debt to date and why the firm’s annual accounting report for 2013 had not been submitted to SSM.
On March 11, Ong said that PPFI, an obscure firm that had that racked up RM27.9 billion in liabilities in 2012, could have easily doubled up on its debt by now if left unchecked.
He had claimed that just last year, the company took on an Islamic Bai Muajjal loan with the Employees Provident Fund with a RM19.5 billion ceiling, potentially bumping up PFI’s liabilities to over RM47 billion.
“The spending of the government-owned company does not appear anywhere in any of the federal government budget accounts which means that all expenditure are ‘off-budget’ items,” Ong claimed in a statement.
He also claimed that the lack of transparency on the part of PPFI is to “hide” government spending from the actual budget and could easily turn into another 1MDB.
According to the Auditor-General’s report in 2013, PPFI had the third highest liabilities among all government-owned entities at the end of 2012. Its total liabilities were RM27.9 billion, behind national oil giant Petronas and sovereign fund Khazanah Nasional.
Ong claimed that more questions arose after the Federal Land Commission signed a deal in November to pay RM29.2 billion in rental to Pembinaan PFI in staggered payments of 30 blocks spread out over 15 years from February 15, 2013 right up to August 13, 2027.
“The Prime Minister, who is Finance Minister, must ensure transparency in the spending, borrowings and debt repayment involving Pembinaan PFI to avoid another 1MDB scandal from occurring,” said Ong.