After long and in-depth research, full of arduous travel to tedious destinations such as Singapore, Bali, Los Angeles, New York, London and Berlin — with a difficult weekend side-trip to Helsinki — an all-party parliamentary delegation has come to the incontrovertible conclusion that it only rains in India.
The logic is irrefutable. If rain fell on other cities, their roads would also crumple like Commonwealth Games toilet paper. Since no London becomes a moon track with one rainfall, it obviously never rains in London.
Fie on those who think that only Delhi surrenders to water-riven weather. The ‘low way’ (it began as a highway) between Mussoorie and Delhi is a very democratic drive. It begins in BJP khand, swerves through BSP queendom and then zigzags into Congress empire. This national artery gets a nervous breakdown in Uttarakhand, then descends into nightmarish trauma in UP. By the time it enters Delhi, it has an incurable split personality. It should be renamed after Freud.
We are a curious nation. For nine months we pray for the monsoon, and the moment our prayers are answered, we have no idea what to do. It is as if the showers came once a century rather than once a year.
You don’t need to summon Agatha Christie to solve the plot. Most of our roads are constructed for annual destruction, since there is more money to be made in rebuilding than in building. Governments are not merely hand-in-glove with contractors; they are hand-in-pocket. Shared loot is safe loot.
Contractors are not particularly worried about the law; they have lawyers with Satyam on their tongues. A congenial cynic suggested that it was time Parliament passed legislation decreeing that anyone worth more than Rs 1,000 crore would automatically be given bail. Businessmen make money all over the world. The difference is the distance between profit and avarice. The first has limits; greed has none.
In our country, corruption has become mainstream; honesty is a rivulet, which is why the System has developed such sophisticated expertise at deflecting street anger. The game is played out in full public view, and we do not see hypocrisy trapping us in slow motion.
What does the System do when it does not have an answer? It changes the question.
Witness how the rage against corruption in CWG has been manoeuvred into a debate on whether they can be held successfully. Who was responsible for this delay in the first place? Even this question has been diverted. The Organizing Committee, reorganized with some sticking plaster, is being reinvented from villain to victim of mysterious forces. We do not know if any race in CWG will see a nail-biting finish, but certainly the preparation has acquired a nail-biting dénouement.
Fudge is offered instead of explanation. The previous government, it is declared in stentorian tones, took the decision to hold the Games in Delhi. So? The previous government did not decide to hire treadmills for a few weeks at many times their retail price. Instead of treadmills, we have treadmillionaires.
A committee of 10 wise bureaucrats is appointed as the scourge to destroy evil and shepherd the Games towards a shining heaven. What has the committee been tasked to do? To “solve coordination problems…ensure completion…furnish progress reports…tie up loose ends”. In other words, to do within 45 days what should have been done over 45 months.
The simple fact is that they cannot take any decisions because all the decisions have already been taken during The Era of Evil — apart perhaps from a catering contract and sponsorship, the second of which is a revenue decision rather than a spending one. A government committee, incidentally, will provide excellent cover for the return of public sector sponsors.
The critical issue lies elsewhere. Indians are not against the Games; they are against corruption in the Games. Can this committee reverse any of the deals that have been exposed remorselessly by media? Will it return, without payment, the treadmills to those who have become treadmillionaires? Sanctimonious noises about the guilty being punished after the event are meaningless. How? If a contract has been sealed at a particular price by mutual consent, and then executed, how can the contractor be held guilty of malpractice? This is more dust in the eyes of a nation already semi-blind with sleaze.
Suresh Kalmadi was quite right to flash a V-sign after the “accountability” meeting at the Prime Minister’s residence on Thursday afternoon. The scapegoats in his committee have paid the necessary price. None of their decisions have been altered, since there were too many others clinging to the food chain. Nothing has changed, apart from the touch of a few cosmetics that barely hide the accumulated debris of deals. Long live the System.
Unless, of course, it rains on the parade in October.
Syed Mokhtar-linked companies already control the sugar and rice sectors, two ports (Johor Port and Port of Tanjung Pelepas), an airport (Senai Airport), the nation’s largest independent power producer (Malakoff Corp) and water treatment plants (Aliran Ihsan Resources).
Observers and critics have pointed out that a PLUS acquisition, which operates the 973km North South Highway from Thailand to Singapore, could further concentrate ownership of critical national infrastructure in the hands of a private businessman.
Another Syed Mokhtar (picture) concern — automotive group DRB Hicom — told reporters last month that it is not actively looking to buy Proton Holdings Berhad but did not discount the possibility of doing so.
This followed speculation that it had been given the nod by the government to acquire the national car maker.
The Malaysian Insider also learnt that Syed Mokhtar had written to the government to buy 1,200 hectares out of the 3,000 hectares of Rubber Research Institute (RRI) land in Sungei Buloh to be developed by the Najib administration under his Economic Transformation Programme (ETP).
The Malaysian Insider understands that some minority shareholders and analysts have grumbled about the debt levels of his companies, related party transactions and donations of significant chunks of company profits to social organisations linked to him.
MMC, which is involved in railroad double tracking projects and is said to be a front runner along with its consortium partner Gamuda for the tunnelling portion of the upcoming KL MRT, had a net gearing ratio of 271.7 per cent at the end of June and long term borrowings of about RM16 billion.
As part of the consortium bidding for the KL MRT work, MMC is also expected to raise as much as RM3 billion in bridging loans and RM1.8 billion for a performance bond if it wins the job.
The bid for UEM would also require it to purportedly raise RM16 billion in funds together with its consortium partners, potentially stretching its balance sheet even further.
Another Syed Mokhtar controlled entity, Tradewinds (M) Berhad, had RM2.9 billion in debt at the end of March, of which about half were short term in nature.
A well known philanthropist, Syed Mokhtar has donated substantial sums to charitable causes throughout much of his business career.
However, the issue of corporate donations caused discontent among minority shareholders in June after Padiberas Nasional Berhad (Bernas) donated 11.1 per cent of its 2009 net profits, or RM20 million, to the Syed Mokhtar-linked Albukhary University in Kedah.
The Tradewinds group and Tradewinds Plantation Berhad meanwhile donated RM10 million each to the university.
Kedah born Syed Mokhtar, 58, is listed by Forbes magazine as the country’s eighth richest man with a net worth of RM5.25 billion (USD1.7 billion).
When structures collapse or become unusable, there is usually a host of issues involved. Identifying the cause or the person responsible is not that easy.
When buildings and other structures develop cracks and leaks soon after, and sometimes before, they are handed over or fully occupied, hundreds of millions of ringgit are lost.
Such incidents are naturally bound to attract considerable attention. However, when such structures are government-owned and thus, invariably funded by the public, the subject becomes an even greater concern.
One recent instance is the Road Transport Department Head quarters in Sabah. Before that, cracks were also found in the hospital there. On the peninsula, the latest disaster was the collapse of the stadium roof in Terengganu.
Such instances become media events and are accompanied by loud protests and condemnation by officials.
The public will be assured that such occurrences will not be allowed to happen again. Newspapers may add to this feel-good factor with headlines such as “No more shoddy work”.
Structures that collapse are not particular to our cou ntry – they happen everywhere.Right and remedies
Nevertheless, the individual is left wondering. Owners of such structures have advisers and consultants at their disposal, yet why are there such shortcomings when contractual documents provide for plans to be followed, materials to be used and the way in which the work is to be done?
The contracts entered into are not much different from those used in other countries.
The Construction Industry Develop ment Board, the Institute of Architects and the Public Works Department, among others, have their own recommended standard forms. These are based on forms developed over decades to provide a balance between the rights of the owner/employer and the contractor.
Such contracts are accompanied by plans. They provide the specifications in all respects and the materials to be used. There would also be provisions for further detailed drawings and work methods for supervision.
Cracks, cave-ins and leaks in a structure could occur at the early design stage. If this is when it happens, then the contractor is certainly not to blame.
The contractor would likely have constructed the structure according to the plans and specifications. But the structure was not adequately designed to stand the stress and strain that it was going to be eventually exposed to.
In the construction of a road, for example, the correct materials may have been used and all requirements could have been complied with.
However, in drawing up the specifications, the type of traffic and volume may not have been carefully considered.
Here, one cannot blame the contractor who carried out the roadworks.
The blame lies with those who did the overall design and overlooked the aspect of the nature of vehicles that would be using the road including the frequency and load.
Construction phase
The blame may still lie with the contractor, but not directly. There may be a specialist or other nominated sub-contractors involved. They may be under the umbrella of the main contractor or directly employed by the employer, which of course can impact on those who should be responsible.
Then there are consultants. They are not only involved in the preparatory work but also in supervision. One specific person at least will be designated to supervise. He could be the architect, engineer, project manager or someone else. The name does not really matter.
The supervisor’s role is to ensure and oversee the work so that it is done in accordance with the contract. He enjoys extensive powers and can give directions on work procedures. He is entitled to check on the work done. If a specific work has been completed but is concealed, he has the right to ask that the place is opened up to check the corrections of the work done.
So when work is approved, although it is not done according to the contract and correct procedures, a problem may potentially arise.
In such situations, not only is the contractor in breach, but there could also be complicity on the part of the consultant. Whether this is the result of incompetence, neglect or wilful collusion is another matter.
Other factors
Whether all those entrusted with the construction are incompetent, negligent or deliberately involved in a wrongdoing, there can be other contributing factors.
A contractor is in the business to make a profit. Therefore, when a contract is priced, it will take into account the costs of material and labour as well as provide a margin of profit.
Yet on occasion, the contractor who actually constructs the structure may not only fail to make a profit but also incur a loss. One may question the wisdom of taking on a loss-making job but in reality it is not as simple as this.
Sometimes a profit may be foreseen when the contract is tendered for and accepted to be performed.
However, material or labour costs, and sometimes both, may escalate. In the end, no profit may be made.
In other cases, a contract is sub-contracted. In the process, the profits are skimmed and the contractor who eventually takes on the job cannot make a profit or may even incur a loss. Why a contractor accepts a job in such a situation is another matter.
The fact remains that the shortcoming of the contractor should not escape the scrutiny of the supervising officer. If he does not do his job, the supervising officer contributes to the problem.
Of course it is possible that problems in connection with a structure are beyond the control of the parties involved.
It has to be said that such problems are not particular to our country – they happen everywhere. But while this is true, it is of little comfort to those who are the victim
Is the delisting of UEM Group to coverup a major loss?
Khazanah announced the appointment of Tenaga Nasional Chief Financial Officer, Datuk Mohd Izzaddin Idris as the CEO for infastructure group UEM Groups (UEM) from July 1.
Critics are saying why take the CFO of TNB, a losing concern. A good answer for simple deflection would be that the TNB CEO won the CEO of the year award.
Omar Ong and Ethos Consulting may have design CEO’s KPI without Profit and Loss as part of criteria? Heard he is busy working on denying new Tan Sri Syed Hamid Albar the Petronas Chairmanship post. Wonder what about his Directorship in Petronas?
My source in TNB claimed Izzaddin is brother-in-law to Tan Sri Azman Mokhtar, the CEO of Khazanah and member of the Board of Director of UEM. Izzaddin got married after building a career with Malaysian International Merchant Bank (MIMB), and later free lancing as consultant with Ranhill.
He is the senior to former UEM World CEO and current Maybank CEO, Dato Abdul Wahid Omar. But the school is not MCKK or MC Gay Gay, as the joke these days, the Alma Mater of claimed brother-in-law, Azman.
There is no issue of his claimed family relation. The securities law does not consider brother-in-law as related party. If he is a suitable candidate and the process is transparent, it is quite alright.
Being appointed CEO for UEM Group, it is a step-up for Izzaddin. Why does UEM Group need a former Merchant Banker to be CEO? Why not an Enginner since UEM is involved in many construction job abroad and locally? Why no more Accountant like former MDs, Dato Ahmad Pardas and Wahid Omar?
There is usually only one possible reason and that is UEM is facing a major problem with the Banks. They need a Banker specifically to solve issues with Banks.
For information, UEM had delisted itself sometime fourth quarter last year. UEM Land, which is involved with the Nusajaya/Iskandar project, took over the listing status of UEM World. Also being delisted are UEM Builders and CIMA.
With the delisting, UEM is controlled and answerable solely to Khazanah. UEM is not subjected anymore to the corporate governance rule of Securities Commission and Bursa Malaysia to announce every damn thing, except small office renovation, and stationaries and toiletaries purchases.
Is the listing intended as a cover-up? God knows.
But yours truly received a set of legal documents sometime back on April 27th. It is a filing made by the State of Qatar in their courts against UEM for failing to fulfill their part of a contract awarded to them in 2001. It is public document, thus it is not an OSA offense or civil defamation or whatever.
2001 was during the years Tun Dr Mahathir was a relentless salesperson of our nation. Malaysian companies secured much contracts and works from his effort. Now they blundered his efforts.
The filing may have been made a month or two before and for convenience, assumed as end February or early March 2009. The claim on the defendents jointly is for Qatarian Riyal QR 876,318,972 – 06.
To summarise the 13 page contract, the plaintiff which is the State of Qatar, claimed that the defendents Parsons International Ltd, UEM Group Berhad (then) and Qatar Insurance Company failed to fulfill the deliver and meet the specifications in the building of Salwa Road in Doha.
This figure does not include QR400 million expected to be levied on UEM and Group for the cost to complete the road the project. The financial burden on UEM and Group could reach almost QR 1.3 billion. How much would it translate to Ringgit? Could somebody help here.
UEM Land debut on the Bursa Malaysia on November 18th, 2008. By that time, UEM is no more listed. No news is heard of this claim.
According to little bird, UEM and Group have engaged a US-based legal firm with an office in Doha, Pattons Boggs to represent them. It seems UEM have been told of the Qatar Government intention to sue them as far back as March 2008 but they underestimated the Qatari and ignored at their own peril.
As of to-date, according to little bird, UEM account and operation in Qatar is frozen to tune of QR294 million. The breakdown is QR100 million in progress payment, QR87 million in performance bond, QR36 million in retention sum, QR60 million in plants and equipment and QR11 million cash.
In the latest twist of event, the Qatar Government will be issuing a warrant of arrest on Dato Ahmad Pardas, the former UEM Managing Director, Dato Ridza Abdoh, Managing Director of UEM Builders Berhad (then) and few other senior officials directly involved in the project.
UEM Builders shares have been transfered from UEM World to the delisted and Khazanah managed UEM.
Is there any truth to this revelation? Khazanah Public Relation people that used to express willingness to engage bloggers, should answer for this.
Khazanah means “treasure” and we are talking here of a major lost of the national “treasure” or wealth. A proper explanation is due. If true, why is there a coverup from the investing public and taxpayer?
Naturally, the first response is to acknowledge or deny. The rest of the staggering 13-page document could be made available for public scrutiny, so please no cheap denial.
Tell us how are they to resolve all this. Little bird said the UEM people wanted Wisma Putra to slow talk with the visiting Qatar Emir some weeks back. However, they do not have anything tangible to offer should the Emir demand something in return.
Little bird said there is problesm in the Indian contracts too.
For Izzaddin, my oh my, what headache you are in for. Wondering now, if those complainants would like to have his new job?
Malaysians should pity PM Dato Seri Najib for inheriting sleepy former Khazanah Chairman’s mess. Yet, Anwar wanted to propose a vote of confidence for sleepy. What an idiot!
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