Friday, May 27, 2011

Another Day In Paradise, Another MAS

When government makes their budget allocation, when they spend the revenues they receive from taxes, duties, our natural resources - they are basically directing how our funds are properly allocated and accounted for. Just because the other person did not touch you does not mean its not "rape". Just because it did not come directly from our wallets does not mean the money does not belong to the us (the public).

Why were people angry when it comes to MAS bailout? Why do we need to bailout the water companies now? Where is the business logic? Is it similar to the US bailouts of banks and insurance firms? No, at least that was too major a situation which could have jeopardise the entire financial industry for years.

What are we jeopardising here?
When these companies gleefully pay themselves dividends in the past, now the government has to step in? Can we get back the dividends then?

IF THATS THE CASE, LET ME RUN A GLC, I WILL MAKE HUGE BETS BY INVESTING IN VARIOUS VENTURES USING FUNDS RAISED VIA BONDS AND SUCH. When they pay off, I will be a grand hero and reward myself and my cronies richly. When they fail, I can come up with 101 excuses and the government will redeem the bond at par. How to fucking lose???

What kind of entrepreneurship mentality are we cultivating here?
Gawd, a few of the owners of these companies are already worth hundreds of millions and they don't stand to lose a sen.

Is it because they cannot collect rates from users, or they are not allowed raise rates, which is why the government has to "pay"??? What kind of business model did they all set out to do from the start before committing billions? Why is it then that companies are sooo keen to own these "water companies"? How can they make hundreds of millions before and pay themselves big dividends? What went wrong?
Why is it that the government always have to bail out these losers?

Want to define what are wastage and leakages ... this is a prime example, people.


Pua: Water bonds premium price abuse of public funds

May 27, 2011

KUALA LUMPUR, May 27 — The federal government’s decision to buy back Selangor water bonds at a significant premium is not only an abuse of taxpayers’ monies but borders on the outrageous, Tony Pua has said.

Quoting The Edge Financial Daily, the DAP publicity chief said the RM6.5 billion rescue deal will see Putrajaya acquire the bonds for 94.49 against a mark-to-market value of only 54.54 at the end of last month, or 73.2 per cent above market value.

Pua (picture) said the bond buyback, which will be done through the Water Asset Management Company’s (PAAB) wholly-owned unit, Acqua SPV Bhd, was akin to the bailout of Malaysian Airlines System Bhd (MAS) in 2000 when the government paid 121 per cent above market value for Tan Sri Tajuddin Ramli’s shares.

Putrajaya has also not been clear on how it plans to restructure Selangor’s water industry in line with the Water Services Industry Act 2006 after taking over the debts and whether water concessionaires will be required to repay the government, he said.

The Petaling Jaya MP said it was inexplicable that the government would settle outstanding bonds of privatised water companies when the companies’ shareholders should be taking responsibility for their own debt.

“In fact, when these companies were profitable, they have declared handsome dividends for their shareholders. Among the concessionaires, Syarikat Pengeluaran Air Sungai Selangor Holdings (Splash), whose parent company is Gamuda Bhd, declared dividends of RM578.6 million in 2007 while Puncak Niaga Holdings Bhd (PNHB) had declared dividends amounting to RM214 million between 2006 and 2010,” he said in a statement today.

“The above certainly makes true the dictum of the BN government privatising profits and socialising losses by taking over the debt burden of these companies.”

Pua said that Energy, Green Technology and Water Minister Datuk Seri Peter Chin should disclose terms of the bailout as it will affect the basic right to water of Selangor, Kuala Lumpur and Putrajaya residents, as well as billions of ringgit in taxpayers’ monies.


solomon said...

Bulu kambing keluar dari kambing....maybe no hike in oil price and electricity tariff, it mean water tariff hike leh?

Wonder u should say hard core after the consensual??

I don't believe feeding the cronies lah, where got in our country? We are very clean one.....i wonder whether what our shanghai beach Ah Lek and perkaka will say after the PJK scholarship......

Another day in kuala lumpur.

ronnie said...

Privatising profits and socialising losses. So apt.

LOTUS said...

The PAP was dented in the recent elections. Well, the BN thought that voters can be fooled till eternity.
Tony has got it right. It is a bailout of fat cats.

Digital said...

Hello Dali, another interesting topic to blog on Sime. Years ago Sime bought the Teluk Ramunia yard from Ramunia for RM515mil and now sold it for RM296mil. What kind of business deal is this?

clearwater said...

That's the Umno crony way of doing business refined to an art form during the Mahathir era. A bailout can never be far away. Heads I win, tails you lose. All done without accountability to oneself and with future consequences to the public purse.

Marco said...

That's why I never buy any GLC stock.

Kingsmen said...

smart alec tony....what's the story behind your cyber village? there's more than meets the eye....pot call the kettle black