Scrap Mentri Besar Incorporated and review other GLCs, says academic

Edmund Terence Gomez from Universiti Malaya speaks at the Malaysian Economic Convention 2019 at Eastin Hotel in Petaling Jaya June 17, 2019. — Picture by Choo Choy May
Edmund Terence Gomez from Universiti Malaya speaks at the Malaysian Economic Convention 2019 at Eastin Hotel in Petaling Jaya June 17, 2019. — Picture by Choo Choy May

PETALING JAYA, June 17 — The various state-owned Mentri Besar Incorporated (MBI) companies are not necessary government-linked companies (GLCs) and should be scrapped as they lack transparency and accountability, Professor Terence Gomez said today.

The Universiti Malaya political economy lecturer told reporters that the various State Economic Development Corporations (SEDC), which had been incorporated since the 1960s, were already serving the same role as MBIs, but had better oversight in comparison.

“The (federal level) Economic Planning Unit (EPU) had a link with the SEDCs and someone from the federal government would sit on the board of the SEDCs. So there was a connection in terms of policies at the state level and federal level.

“When you look at the board of directors of the SEDCs, they have bureaucrats, federal level people and relevant people to the SEDC sitting there. Of course the Mentri Besar is the chairman. So there’s a check and balance, there’s accountability.

“But subsequently many states created what is known as Mentri Besar Incorporated or Chief Minister Incorporated (MBI). MBIs do not even have a board of directors. It is directly under the control of the Mentri Besar.

“There is no federal links with MBIs, there is no accountable, transparent processes going on as far as the MBI is concerned and they seem to be doing the same things as the SEDCs, which doesn’t make sense,” explained Gomez.

He said it was best to get rid of the various MBI while sticking to the SEDC.

However, Gomez also said that a complete revamp of the whole GLC system at the federal and state levels is needed so that each entity can be fined-tuned to serve a specific purpose.

Unfortunately, the academic believed that the Pakatan Harapan (PH) administration lacks the political will to review and revamp the various GLCs as it can be used as a tool of political patronage.

He recalled that prior to their victory in the 14th General Elections, PH had campaigned partially on grounds of reviewing the various GLCs due to the level of abuse that occurred in 1Malaysia Development Berhad (1MDB), Lembaga Tabung Angkatan Tentera (LTAT) and Tabung Haji among others.

“Well, when they came to power, one of the first things I thought they would review would be the GLCs because (Prime Minister Tun Dr) Mahathir (Mohamad) himself persistently referred to it as a monster — the whole system.

“And we had serious problems involving GLCs specifically 1MDB, LTAT and Tabung Haji (among others) which came up during the campaign.

“So since all these were at the core in the topic of corruption in particular and they all entail GLCs, one would think the first thing the government would do is to set up a committee to look at the whole GLC monsters as Mahathir called it.

“But Mahathir didn’t do it. Why? My reasoning is that Mahathir himself probably felt the system as it stands now is an important mechanism for consolidating political power,” Gomez said.

He elaborated saying that the revamp that did occur when it comes to GLCs is that many of these entities had ended up under the purview of the Prime Minister’s Office and the Economic Affairs Ministry, while the Finance Ministry was declawed.

He also believed that the Rural and Regional Development Ministry is critical for Dr Mahathir’s Bersatu party as the ministry has multiple statutory bodies and GLCs serving the rural Malay population — which is Umno’s bastion and a voting bank that Bersatu wants to win over.

Gomez pointed out that this raises the inherent risk of more political patronage occurring between the ruling party and the rural poor, coupled with the abuse of the GLCs through the current system.

He then raised the question on who made the decision to redistribute the GLCs and whether or not the Cabinet was first consulted.

“That’s how I see it. I hope the government will prove me wrong by setting up a proper committee to look into the whole GLC system and reinstitute it properly so we can get rid of the companies we don’t need.

“We can define exactly what [are] the different types of GLCs, for example the statutory bodies, the foundations and the holding bodies and declare what their role is for each specific institution.

“And it must be done in the interest of proper and transparent domestic enterprise development in the interest of the people,” he said.

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