The Fall of the Corrupt

IN Ayi Kwei Armah’s book, The Beautyful Ones are Not Yet Born, the protagonist is a civil servant who chooses not to take bribes for favours at the expense of his children’s education and basic access to shoes. He is surrounded by friends who, unlike him, benefit from the corrupt system and live in luxury.

That is, until the regime one day falls. His friend, to escape conviction, enters the latrine and wades through faeces, symbolic of the muck of deceit he was part of. The main character is vindicated and continues to live life the way he has chosen: uncompromised honesty.

For far too long, Malaysians have become used to corruption as a way of life. It is part of the air we breathe; many businessmen are obliged to include under-the-table money to ease approval processes to government bodies, infrastructure projects are inflated in value, and deals are often shrouded in secrecy without open tenders. We have become accustomed to the rule that there is no price to pay for corruption since even the highest-level offenders can get off scot-free.

But the astoundingly swift events following the general election may give us reason to believe otherwise. After the fall of the Barisan Nasional government, Prime Minister Tun Dr Mahathir Mohamad has moved quickly to act on his promises to clean up the government.

The heads of key institutions that are said to have colluded with Datuk Seri Najib Abdul Razak in the 1MDB scandal have either resigned or been terminated. This includes the attorney-general, Apandi Ali, Malaysian Anti-Corruption Commission chief commissioner Dzulkifli Ahmad, and Treasury secretary-general Irwan Serigar (chairman of the 1MDB board). The purge of the top leadership has begun, and others who are proven to have had a hand in aiding and abetting corruption will surely also begin to quiver in their seats, now that the 1MDB case will soon be reopened.

With the formation of the new committee on institutional reforms announced two days ago, it is foreseeable too that with institutional reform will come the replacement of individuals unfit for duty. It is time for those with the best capabilities and calibre to be appointed, especially those with no record of corrupt deals.

However, the challenge is, this is the system that has existed for such a long time that undoing and untangling the complex web will not be immediate. The danger is that instead of wiping out the culture and practice of corruption, there is a new slate of cronies ready to receive the goodies from the gravy train they were waiting for all along. Switching from one group of rentiers to another would not signal real reform, only the changing of guards.

There may have been a “Malay tsunami” that is said to have happened across Malaysia, where even hardcore Umno supporters chose to switch camps to vote for Pakatan Harapan for the first time, but it is important to note that voters in different parts of Malaysia voted for different reasons.

While it may have been for governance and anti-corruption reasons in the cities, it is more likely for economic and bread-and-butter reasons in rural areas. After all, the main message of Pakatan was to abolish the GST, which was the convenient bogeyman to explain the rising cost of living. Would they expect the culture of hand-outs and “money-for-votes” to stop? Probably not – and educating a larger mass audience about the importance of good governance will take an even longer time.

But on the other hand, there is a key lesson to be learnt out of all this: that no one leader can so blatantly pocket millions of ringgit into his own personal bank account without suffering some consequences.

One week ago, we were in a place where we thought that the corrupt would always win, that the system was so deeply rotten there would simply be no alternative. Now we know it is possible to live in a world where some injustices can be righted. Will all past scandals have their truths revealed? Will the system change overnight, so that there is absolutely no corruption at government agencies? Will all past leaders have their corruption record publicly brought to court? Probably not. But there are small triumphs to be celebrated, and celebrate we must.

The unpredictable has taken place: Najib and wife Rosmah Mansor are now on the Immigration Department blacklist, barred from leaving the country. Investigations on their involvement in 1MDB, and possibly other national corruption scandals, will resume under the instruction of the new prime minister.

Under a new attorney-general, perhaps there will now be cooperation to share documents and files with other countries to help them in their investigations of the case. There is now hope in the renewal of the institutions that are meant to uphold the rule of law, in order to protect our fundamental rights as citizens.

In The Beautyful Ones are Not Yet Born, the main character is not given a name, but is just referred to as “Man”. It is believed the author did this intentionally, to tell the story of not just him, but many of us simple civilians living our simple lives.

There are moments in which we may choose the less lucrative option of bypassing bribes based on our conscience, and nobody will celebrate us for doing so. But these are the real heroes of the day, especially when we quietly witness the fall of the corrupt.

First published in theSun, on 17 May 2018.

Reprinted from triciayeoh.com

Malaysia’s new leadership line-up strengthens Mahathir’s hand

May 15, 2018
(Note that this was written and published more than a month ago, commenting on the formation of the first few members of Mahathir’s cabinet)

Mahathir Mohamad named three Cabinet ministers and announced the establishment of a Council of Elders on Saturday (May 12), in a move that strengthens his position within the Pakatan Harapan coalition, says one observer.

KUALA LUMPUR: Malaysia’s seventh Prime Minister Dr Mahathir Mohamad wasted no time in getting to work after the 14th general election concluded with the country’s first ever change in government.

The Barisan Nasional’s defeat was both shocking and historic, since Malaysia has never known any other government since its independence in 1957. Time is ticking against the new Pakatan Harapan government for it to prove itself capable and show quick results.

In a major move on Saturday (May 12), three days after polling day, Mahathir announced the names of the top three Cabinet positions, apart from himself as Prime Minister and Dr Wan Azizah as Deputy Prime Minister, as well as a Council of Elders. These moves will surely strengthen Mahathir’s hand over the administration.

The three he named are Lim Guan Eng as Finance Minister (from the Democratic Action Party, DAP), Mohamad Sabu as Defence Minister (from the Amanah party, the breakaway arm from Islamic party PAS), and Muhyiddin Yassin as Home Minister (from Mahathir’s own Parti Bersatu, and former deputy prime minister under recently deposed Prime Minister Najib Razak).

He was to have announced 10 ministers altogether, but the remaining seven will have to wait. Negotiations with four parties within a political coalition are challenging and a fine balance is required to ensure fair representation, including that of ethnicity, gender and capabilities.

Unlike Barisan within which UMNO was the dominant party in most if not all decisions and appointments, this time the four parties consider themselves to be equal partners with no one party having a stronger position over another.

However, Mahathir in a live telecast statement the following day iterated that although some deliberation among party leaders would take place, the ultimate decision over the final Cabinet members would be taken at the discretion of the Prime Minister.

This may irk some members of the Pakatan Harapan coalition. Yet considering the urgency of addressing the country’s numerous problems, it seems fair to demand swift and efficient action, bearing in mind also the Prime Minister’s age, who at 92 is the world’s oldest elected leader. But Mahathir is doing all he can.

LIM GUAN ENG’S APPOINTMENT STRENGTHENS COALITION POLITICS

The appointment of Lim as Finance Minister is a bold move in the right direction for a few reasons.

First, Pakatan had in its election manifesto committed to separating the positions of Prime Minister and Finance Minister to avoid a conflict of interest.

It was in fact Mahathir himself who first occupied the two positions simultaneously after sacking Anwar Ibrahim (Deputy Prime Minister and Finance Minister in 1998), thereby starting the very practice later followed by his successors and heavily criticised by Pakatan leaders.

Appointing another person into the position is therefore a positive move that provides some check and balance between the top leader and his financial advisor.

Second, it is the first time the position will be held by a Chinese Malaysian since 1974 (occupied by then President of the Malaysian Chinese Association Tan Siew Sin).

During this election campaign, Barisan leaders had repeatedly painted Pakatan as a coalition manipulated by a Chinese-dominant DAP, preying on insecurities among Malay rural communities and suggesting that they would suffer economic losses at the hands of the DAP if Pakatan came into power.

Where having a strong Malay Prime Minister helps to mitigate these fears, appointing DAP’s secretary-general as Finance Minister also indicates confidence on Mahathir’s part.

It is also a reasonable decision given Lim’s two-term track record in successfully managing Penang’s finances, during which time the Auditor-General’s reports praised Penang for its healthy and prudent spending.

While it is based on qualifications – Lim is an accountant by training – Mahathir’s appointment also helps to strengthen coalition politics as a whole.

The other two appointments are also predictable, since by seniority Mohamad Sabu (commonly known as Mat Sabu) and Muhyiddin Yassin respectively would naturally take up top ministerial positions, the latter having significant government experience.

Mat Sabu, who has been detained twice under the Internal Security Act, has been a career politician known for his public-speaking abilities, but will need to prove himself capable of helming the hefty Defence Ministry.

COUNCIL OF ELDERS WITH TIES TO MAHATHIR

Mahathir’s additionally appointed Council of Elders serves as an advisory body to shape policies and programmes to achieve the 100-day promises made by Pakatan Harapan.

Chaired by Daim Zainuddin, Mahathir’s former finance minister, the team includes former central bank governor Zeti Akhtar Aziz, former president and CEO of Petronas Hassan Merican, businessman Robert Kuok and economist Dr Jomo Kwame Sundaram, many of whom had been either stalwart supporters or people who had served under Mahathir.

Dr Jomo is the exception in this array, who in the 1990s was publicly critical of Mahathir’s imprisonment of Anwar Ibrahim, as well as his economic policies. In late 1998, Vincent Tan, a known close associate of Mahathir, sued Dr Jomo for defamation for his articles on alleged cronyism and business in the country, but dropped the case subsequently.

Dr Jomo’s appointment suggests Mahathir is giving priority to economic reform over personal friction.

Bringing in these eminent experts who have vast experience and expertise is also intended to give observers and investors a sense of stability and assurance. Several were architects of the Malaysia Incorporated policy that Mahathir shaped in the 1990s and technocrats able to jump right into rebuilding the nation’s fundamentals.

This council has already begun work, and is expected to conduct immediate investigations into key economic matters. They have already met with key government-linked companies to align governance and investment policies, to ensure markets remain positive and stable.

These independent individuals will also be able to study alleged wrongdoing perpetuated within various ministries and investigate if they had been directed by senior civil servants under Najib’s government.

Already Mahathir has named the Attorney-General’s Office, the Malaysian Anti-Corruption Commission and the Election Commission as three government institutions that will need to be thoroughly examined for bias in their previous policies, with corrective action taken where necessary.

Mahathir has equated the process of forming the new Cabinet with that of Tunku Abdul Rahman’s in 1957, stating that this would be a small Cabinet that takes dressing from the Tunku’s model, which had less than 10 members and which later grew to accommodate more portfolios when proven necessary.

Mahathir has also committed to not more than 30 ministries being eventually formed.

Such hearkening back to the early days of the nation’s formation is a stark reminder to those he is addressing that this is a new beginning.

Perhaps this is what the country sorely needs now – a fresh start, led by one strong and fiercely determined individual.

(First published on the Channel NewsAsia website on 14 May 2018. Taken from Tricia Yeoh’s blog, triciayeoh.com.)

Tricia Yeoh is chief operating officer of the Institute for Democracy and Economic Affairs.

Commentary on Malaysia’s 13th General Election

The 13th general election, which was held on May 5th 2013 across Malaysia, was anticipated to be one of the most hotly contested in the country’s history. This was so because of the extremely tight race between the ruling incumbent coalition, Barisan Nasional (National Front) and the opposition coalition, Pakatan Rakyat (People’s Alliance). Five years earlier, what is now popularly known as a political tsunami swept across the country, in which the Barisan was for the first time denied a two-thirds majority in Parliament and lost a total of five state governments to Pakatan, two of which are the urban and business centres of the country, Selangor and Penang, which together form more than 60% of Malaysia’s GDP.

In the lead-up to the recent polls, the political stakes were high on both sides of the divide. For the first time ever, election manifestos were launched weeks in advance, translated into multiple languages (to accommodate Malaysia’s multilingual society). Separate non-governmental organisations sprung up to monitor the elections, and the social media space was vociferously used to promote policy offerings on a wide range of concerns. The main issues affecting voters, which both the Barisan and Pakatan attempted to respond to, were that of corruption, economic or bread-and-butter woes, and the crime rate.

The reason for the close competition was because for the first time, there was a viable opposition that had branded itself as an alternative federal government, after having achieved key financial successes in the states they govern. Although there were initial criticisms that the three component parties – the Democratic Action Party (DAP), People’s Justice Party (PKR) and Pan-Islamic Malaysian Party (PAS) – were of greatly opposing views over the five years from 2008 until 2013, the coalition was largely able to present a cohesive front, smooth over any major internal flaws and come to consensus on administrative tasks. The coalition also presented a number of common policy documents, including Shadow Budgets in the last two budget cycles that spoke of the ability to agree on a wide range of policy issues.

In this election, Barisan got a further beating by winning a total of 133 out of the 222 Parliamentary seats, 7 less than the 140 it got in 2008. This translates into 59.9% of seats, even though Barisan only received 47% of the popular vote nationwide. The opposition Pakatan won 89 seats, with more than 50% of the popular vote. Amongst the Barisan component parties, the more ethnically Chinese-based parties, the Malaysian Chinese Association (MCA) and Parti Gerakan suffered the greatest losses, losing 17 seats; MCA was down 15 to 6 parliament seats, and Gerakan is left with one. The opposition’s gains were noteworthy: DAP gained 10 new seats, winning 38 in total; PKR won 30 seats in all, and PAS took 21. This is significant given that Barisan leader and Prime Minister Najib Razak had committed to winning back the two-third majority it lost in 2008.

Barisan had also channelled a large amount of resources into winning back the jewel on the crown, the state of Selangor, but ultimately failed to do so. Pakatan strengthened its grip on three of its states, Selangor, Penang and Kelantan, by winning two-third majorities in each of them, but failed to hold on to Kedah, a rural state in the north of the Peninsular. Maintaining a hold on these dynamic states that contribute to the economic vibrancy of the country is considered a positive for the opposition Pakatan.

Although Barisan will continue to lead the country, this victory was marred by numerous allegations on electoral irregularities, which the opposition claim has cost them a possible victory. On the day of polling, many pictures and videos of alleged foreign voters were circulated on social media, claimed to be illegitimate citizens of Malaysia, given identity cards by the government to boost the support for the Barisan coalition. In the lead-up to polling day, other reports were being spread that foreigners were being flown in with the co-operation of the national airlines company for the same reason, some allegedly receiving money in exchange for their votes.

None of these reports can be considered substantiated evidence yet at this point; electoral reform watchdog Bersih 2.0 will hold a People’s Tribunal to collect such reports, whilst PKR is doing the same on behalf of the opposition. With these in hand, election petitions are expected to be filed in court to seek judicial review of the results of 27 separate parliamentary seats that were considered dubious. The criteria for results analysis were seats where the margin of win was below 5%, spoilt votes outnumber a small margin of win, early and postal votes outnumber the margin of win garnered from normal votes, to the extent that it affected the results of the normal votes, and seats that had reports of fraud. To date, complaints received were categorized into six areas, ranging from voters not being allowed to vote because someone had voted in their name, BN purchasing votes by offering cash vouchers, or disappearing indelible ink (Malaysia used indelible ink for the first time in this election to avoid double voting).

Apart from these issues, one of the main problems raised as a result of the elections has been that of malapportionment of constituencies. For instance, there are 15,800 voters for the one Putrajaya parliament seat, but 144,000 voters in Kapar. As a result, there were substantially more voters in Pakatan-won seats (an average of 77,655) compared with those in Barisan-won seats (average of 46,510). The gross imbalance of weightage given to voting constituencies is a deep flaw in the Malaysian electoral system, affecting the ability of the opposition to make greater gains in the future even with a higher popular support. This is a historical heritage of the delineation of constituencies, which is due to be revised this year, the last demarcation exercise having taken place in 2003. However, this time the Election Commission and Barisan politicians will have to negotiate with their Pakatan counterparts since any addition to the number of constituencies will require a two-third majority support in Parliament. This re-delineation process is probably the single most important event that needs to be carefully monitored, as it will have a direct impact on at least the next two to three elections to come.

Several Malay-language newspapers along with some government leaders branded the outcome of the election as a ‘Chinese Tsunami’, which was considered distasteful to many. This was based on the premise that the ethnic Chinese had voted strongly against the government, in favour of the opposition. The messaging would have created the notion that the Malays were pro-government, and Chinese pro-opposition, an unnecessary and irresponsible statement to make given the need for inclusive narratives in the multi-ethnic country of Malaysia. Other analysts, however, have since emerged to critique this, by saying that it was the young and urban voters who chose the opposition, whilst rural voters continued to support the incumbents. This election, for example, saw 25% of all voters being newly registered, with 22% aged 30 and below. This group had no voting patterns to track from previous record, and were the most likely to be urban, having access to the internet, alternative and social media, and therefore more critical minded. Seeing as Malaysia’s population is set to reach an urbanisation rate of more than 70% by 2020, both political coalitions would do be well advised to tailor their messages to this audience.

The coming year will continue to be politically heated as the central party of Barisan, the United Malays’ National Organisation (UMNO), anticipates its party elections in October, along with its general assembly. It has serious rethinking to do, since it now sits as the dominant party in the coalition, due to the failure of other Barisan parties to make positive gains. In the opposition, PKR is also expected to hold party elections at the end of the year, whilst PAS will call its annual muktamar (general assembly) as well. Political observers interested in developments in Malaysia will do well to monitor the goings-on within the parties, as these would have a direct impact on national level politics.

In terms of citizen participation, this election saw a record high voter turnout of 85%. Queues began as early as 7am in many polling stations, an hour before the booths opened to receive voters. Many groups organised their own events, such as a group in urban Bangsar initiating their planting of colourful cloth “Malaysian Spring Flowers” as an indication of the flowering of democracy. Bersih 2.0 put together volunteers to monitor the election process outside polling stations. The Election Commission granted observer status to several local NGOs, who have submitted reports. One such report by the Institute of Democracy and Economic Affairs (IDEAS) and the Centre for Public Policy Studies (CPPS) concluded that the elections were “partially free and not fair”, to which the Prime Minister’s Department has responded negatively. Public participation in the election process seemed to be encouraging, with a great many young Malaysians excited for the first time at the prospect of voting. This is a trend that must be cultivated over the long-term period.

To conclude, the 13th general election was the culmination of the previous two years’ worth of political angst and upheaval. A period of uncertainty had come over Malaysia as the nation waited for the election announcement date, also affecting the stock market and business sentiment. Now that the results have been announced, things have largely swung back into rhythm, with the exception of opposition rallies that are being held across the country, in rejection of what it considers to be an illegitimate government due to electoral discrepancies. Only time tell if the courts will accede to the election petitions, failing which it is back to the court of public opinion that both the Barisan and Pakatan coalitions will appeal to in the months and years to come, before the next election takes place (either at the state or federal level). Until then, the democratic system of elections and governance will continue to be questioned, and it is hoped that leaders in the country will take cognizance of this in seeking the institutional reform needed for Malaysia’s long-term progress.

(Written for and first published by Freedom Barometer)

Tricia Yeoh blogs on triciayeoh.com

Malaysia is no Egypt

NEGATIVE advertisements are flooding mainstream newspapers in this very electric season of the 13th general election campaign, but many fail to convince. One full-page advertisement caught my attention, paid for by the MCA, a component party of the Barisan Nasional.

Its title reads “Ubah (Change) for the worst? What can we learn from the Egypt, Tunisia, Libya, Yemen, Syria and Bahrain free fall?” and describes what it imagines to have taken place in these countries during and after the Arab Spring.

The advertisement outlines the following series of events: “People get fed up with the government; Ruling party is forced to step down; Civil war in the streets and chaos in the country; Political instability, economic turmoil; Economy goes down, unemployment goes up; People get fed up with new government; Want to go back to the previous government.”

These are incredible generalisations about the named countries to create an argument against changing the government in Malaysia.

Change they did

I had the privilege of attending the 9th Aljazeera International Documentary Film Festival last week in Doha, Qatar, where my documentary on the late Teoh Beng Hock was competing. At the festival, documentary makers had the chance to share their stories from around the world.

Many films portrayed stories of hope and liberation juxtaposed against oppressive regimes, which included the Tahrir Square uprising in Egypt.

In the documentary After the Storm: A New Beginning for Egypt’s Economy, it was clear that although Egypt continues to struggle with poverty and unemployment, these were caused by decades of the previous regime’s economic mismanagement which distorted competition and benefited the wealthy at the expense of the poor.

Second, it also showed how it is precisely because of the revolution that locals were now more optimistic and able to take control of their own economic situation.

By placing this poorly thought-through advertisement, is the MCA then implying that Egyptians ought to have been content with their previous leader Hosni Mubarak, and continue living under such appalling conditions?

This would have made them out to be weak and spineless, supporting a regime that would shamelessly continue to subject them to atrocities.

Different circumstances

Equating Malaysia to Egypt is inaccurate, since both countries operate under different circumstances and contexts.

Although this country is suffering from a heavy national debt and tremendously unhealthy levels of wastage and corruption, it is nowhere close to the conditions in which the Egyptian uprising took place.

In fact, each point laid out in the ad can easily be rebutted. First, Mubarak was forced to step down due to a people’s revolution; in Malaysia, any change in government would take place as part of the normal processes of democratic elections.

Second, it is presumptuous to predict that there would be chaos in the country should there be a change, since Prime Minister Datuk Seri Najib Razak has already committed to there being a peaceful transition of power should it come to pass.

One hopes he will also ensure all accompanying government agencies like the police and military would assist in this.

Third, the ad assumes that the economy would get worse under a new government. The financial performance of Pakatan Rakyat state governments over the past five years speaks for itself, with budget surpluses and higher savings than ever before.

Bank Negara Malaysia, Securities Commission, Bursa Malaysia, and other fundamental institutions would also play their roles to responsibly ensure that no major shake-up would take place, safeguarding interests of investors and businesses.

Finally, the ad says that as a result of these upheavals, people would get fed up and want to return to the previous government, to which anyone who believes in free and fair elections would say, “By all means!”

Should there be dissatisfaction in the new government, it is the voters’ prerogative to change them when the time comes.

In the documentary, the filmmakers do not present a rosy Egypt – far from it, since there is much work to be done, reversing years of deep structural failure in the government and the economy.

Perhaps if there is a lesson to be learnt from their story it is that first, when the time is ripe for things to change for the better, this will be inevitable since it rides on the sentiments of the people. But second, that when such change does come, people must acknowledge the difficulty of correcting deeply entrenched wrongs.

Overhauling a system will not take place overnight, and so Malaysians must be willing to persevere over the long run as a new government works out the many intricate problems of a bureaucracy that has been for so long under one political coalition – accompanied by its problematic systems and structures.

Until polling results are known on May 6, perhaps political parties ought to present more rational and intellectually responsible advertisements to the electorate.

(First published in theSun on 26th April 2013)

Tricia Yeoh blogs on triciayeoh.com

A manifesto on the back foot

The term back foot refers to being at a disadvantage, and forced to being defensive of one’s position, usually used in sports where a player is outmaneouvred by an opponent. Barisan Nasional’s recent behaviour indicates it is operating in such a manner.

For the first time in Barisan’s history, it unveiled its election manifesto before nomination day, needing to respond to the Pakatan Rakyat manifesto launched more than six weeks earlier. In fact, when Prime Minister Dato’ Seri Najib Tun Razak announced Parliament dissolution a few days before, he called for peaceful transition should there be a change in government either at the federal or state levels, indicating that this would be indeed possible in his opinion. His deputy has also recently admitted that Pakatan is a tough opponent.

Whilst these are mere indications, the most telling of all are the contents of the Barisan manifesto, numerous items of which are plainly either replications of proposals already contained in the Pakatan manifesto, or following in the footsteps of policies already instated by existing Pakatan-led state governments.

To get a better idea, all of these items were first introduced in Selangor and Penang: increasing NGO representation in local councils; initiating the need for gazetting of native customary rights, or orang asli, land; giving allowances to Kafa teachers in Islamic schools, financial assistance to Sekolah Agama Rakyat, and public disclosure of contracts. Perhaps one ought to take it positively that the Pakatan states were able to blaze the trail as best practice case studies for the rest of the country to follow suit.

As for items that seem mysteriously similar to the Pakatan manifesto, this is because they are. These include the proposal to revisit constructing the Pan-Borneo Highway in East Malaysia, revamping the National Automotive Policy to gradually reduce car prices by 20-30%, as well as increasing payments to oil-producing states in excess of 20%, on top of many others. A quick reference to the Pakatan manifesto would reveal these exact proposals. One wonders at the irony of the Barisan leaders who in one breath ridicule a manifesto that in the next, they imitate.

To evaluate a manifesto, one must first establish the root problems of the country, which here I will classify into three categories namely public administration, the economy, and race relations.

One, Malaysia has an extremely top-heavy system of government, with decisions entirely made at the Executive level, highly centralised in Putrajaya, with a severely weakened Judiciary and ineffective Legislative. Two, Malaysia’s economy is either dominated by government-linked companies (GLCs), monopolies in essential goods industries, or highly influential and well-connected cronies leaving little competition for the small to medium players. Three, the issue of politicised race and religion which will only prevail as long as political parties continue to be defined along such terms.

The Barisan manifesto does little to address the first problem, where in fact it plans to set up yet another ministry to address urban economic and social challenges. With an already bloated government of 30 ministers and 38 deputies, it fails to convince that a new ministry would be an effective resolution to the problems of urban poverty.

Whilst proposals to boost public transport, waste management and water services nationwide are welcome, there is no mention of empowering state or local governments in such regard, who would be better equipped at knowing local issues. In terms of governance, although it is encouraging that steps are being taken to strengthen the MACC, no mention is made of internal mechanisms for checks and balances. One needs only recall that the three officers responsible for the late Teoh Beng Hock’s interrogation have been referred to the MACC Internal Complaints Committee with no further update on their being reprimanded.

On the count of the economy, the manifesto seems to commit to flooding the market with a host of 1Malaysia-brand items, clinics and centres through its Kedai Rakyat 1Malaysia, setting up of Klinik 1Malaysia, and so on. This has effectively created a second parallel market for those classified as lower income, operating on a second track outside the real market of goods and services. This has created a ‘government-economy’ alongside the ‘market economy’.

Instead of addressing the economy holistically, the government has introduced an entire ecosystem of a subsidised market. There is also a significant lack of mention in addressing macroeconomic targets such as balancing the budget. One also wonders at the beneficiaries of this subsidised market, where the manifesto also unreservedly states that the Barisan would “introduce more 1Malaysia products driven by GLCs”.

Finally, the manifesto stated that “we abhor the politics of hatred and division”, whilst it believes in “social justice and being inclusive, touching and improving the lives of all Malaysians irrespective of race and religion”. Numerous contradicting public statements by Barisan leaders notwithstanding, it is the very nature of the Barisan political parties formed along ethnic lines that will make it impossible to exit the game of playing the race card to its own benefit.

Without solutions that can truly and fundamentally reshape the Malaysian structure of public administration, the economy, and race and religious relations, through the reforming of systems and institutions, we will not be able to make that great leap forward. In fact, in Barisan’s own terms, “we cannot put at risk what we have; we cannot gamble away our future”: these words ought to be a stark reminder to all who go to the polling booth come election day.

(A version of this was published in theSun on Wednesday, 10th April 2013. This is the slightly different, unedited version).

Tricia Yeoh blogs on triciayeoh.com

Some thoughts on GE13

I was asked a common series of questions on the upcoming 13th General Elections. Here are my answers, as posted on the New Mandala website! Thanks goes to Greg Lopez of the Australian National University for this.

1. What do you think will be the most important issue that the new government must address?

The new government must address economic growth and distribution: ensuring there is a strong economic base, new industries and creating an open, innovative environment to attract the right workforce; as well as making sure national wealth reaches the lowest income groups, especially in rural areas that still have no access to proper water and sanitation.

2. What do you think is Barisan Nasional’s greatest strength?

Barisan Nasional’s greatest strength would be its numbers of years as a coalition government, its ability to govern together with all parties. However, this is not saying the governance itself has been of stellar performance.

3. What do you think is Barisan Nasional’s greatest weakness?

Barisan Nasional’s greatest weakness is the fact that its major parties are race-based. This is the biggest constraint it has, if it wants to move beyond ethnic politics, as each party (UMNO, MCA and MIC) will continue having to retreat to their ethnic support bases when campaigning for votes.

4. What do you think is Pakatan Rakyat’s greatest strength?

Pakatan Rakyat’s greatest strength lies in its philosophy of new politics, that politics has to move beyond race. Acknowledging the cultural differences between races, none of the three parties advocates a Malay, Chinese or Indian-based approach to solving national problems. They focus on the community’s particular needs, on raising incomes irrespective of race or creed.

5. What do you think is Pakatan Rakyat’s greatest weakness?

Pakatan Rakyat’s greatest weakness lies in its lack of professional experience as administrators in government, which the civil servants have taken advantage of in the early years of Pakatan Rakyat running the state governments of Selangor, Perak and Penang. This is where Pakatan Rakyat will have to rely on the expertise and experience of trustworthy civil servants, retired civil servants, and other practitioners and academics when it comes into government.

6. What is your hope for Malaysia?

My hope for Malaysia is that its young will grow up in a country they feel they are proud of, that they fully belong to, and a place they will want to live, work, play and retire in, even for their future generations to come.

Tricia Yeoh blogs on triciayeoh.com

Peaceful transitions

PRIME MINISTER Datuk Seri Najib Razak said this week that a weak government owed to a reduced parliamentary majority would mean instability and uncertainty, in a bid for greater support for his Barisan Nasional coalition.

Surely he ought to realise that it is the indecision over when the election itself will be held that has contributed to this situation of uncertainty.

Such political risk could have been avoided by a straightforward announcement ahead of time of the election date instead of allowing this continued speculation for well over two years.

There is a wide range of opinion as to how the electoral outcome will affect national stability, in terms of both social and economic effects. For instance, Credit Suisse reported that foreign investors in Malaysia may do a good deal of selling ahead of the general election in light of such political risk.

According to the Wall Street Journal, foreigners hold around 25% of overall share capital in Malaysian banks, “the highest level since the global financial crisis”. Analysts such as MARC also predict that the ringgit will weaken over political developments relating to the election.

However, one must be careful not to equate the high political risk involved in an uncertain election outcome with that of instability due to a possible government change.

The adverse economic impact would come about mainly because this has never taken place before, and without any precedence, it is difficult for people to imagine being governed by any other political coalition.

A recent public forum organised by Institut Rakyat, Penang Institute and the Islamic Renaissance Front discussed this matter.

Datuk Seri Anwar Ibrahim, leader of the opposition coalition Pakatan Rakyat, reminded the audience that a peaceful transition from one government to another would really reflect upon a mature democracy.

This is true, since if the system itself has in-built robust mechanisms to allow for a transfer of power, then there really is no need for fear – the kind of fear that incumbent governments are wont to drum into voters to have them cower under, all for the sake of prolonging their positions.

Titled “Economic Management during Political Transition”, it was a valuable opportunity to discuss what kind of economic policy would prevail should there be a change in government.

Malaysia’s institutions seem to be strong enough to withstand any major shocks. Indeed, the World Bank did say that Malaysia has a large capital market, strong institutions, sophisticated participants and high quality accounting practices. In short, the economy will not collapse should there be a change in government.

Panellists also spoke of experiences from other countries which had also gone through political transition.

One particularly interesting insight was from Professor Woo Wing Thye from Penang Institute, who showed how leaders in autocratic regimes would fail in their attempts at reforming their countries, as long as they were nominees of the previous government.

For example, this was one of the factors that allowed reform in China: Mao Zedong’s appointed successor Hua Guofeng failed, but Deng Xiaoping who deposed him succeeded.

Likewise, politicians in Malaysia should note that any reform must be led by a leader who is not tarnished in any way by the acts or wrongs of its predecessor. Whichever coalition wins, the appointed prime minister would do well to remember this.

On a final note, it is no longer an excuse that because Malaysia follows the British parliamentary system, therefore the executive body can arbitrarily set the election date, which is the current custom.

The United Kingdom’s Parliament passed the Fixed-Term Parliaments Act 2011 that introduced fixed-term elections. According to this law, barring certain exceptions, polling day would occur on the first Thursday in May of the fifth year after the previous general election.

Parliament would automatically dissolve 17 working days before polling day.

For the sake of certainty and stability, which the prime minister prides himself on assuring, this may be a welcome step in the right direction.

In memory of the late Zainon Ahmad, or Pak ‘Non, who helped me believe in Malaysia.

First published in theSun on Friday, 29th March 2013

Tricia Yeoh blogs on triciayeoh.com

Don’t muddy the water issue

The water saga between the Selangor government and water operator Syabas took another turn in the latest episode of the Wangsa Maju pump station fiasco that affected more than 27,000 households in the Klang Valley. It is easy to confuse the many issues, thereby muddying them together. But first, some facts.

The Wangsa Maju pump house – which is made up of 4 pumps and 1 for standby purposes – broke down on 29th December last year and 1st January, and since then the blame game has ensued between both parties accusing the other of being at fault. The pump house has a design capacity of 180mld (million litres per day) in total.

Syabas claims that the failure was due to “operating above its design capacity for a long period of time in recent years” (Syabas, 15 January 2013). Selangor state checks, however, revealed that throughout 2012, the pumps operated beyond its capacity of 200mld for only 18 days out of the whole year.

The central issue here is whether or not the pumps have actually been well-maintained to operate consistently without breaking down. The responsibility to maintain these pumps falls under Syabas and not the Selangor government. According to standard operating procedure, ‘preventive periodic maintenance’ is a basic requirement that should have been conducted by specific capable contractors. This was apparently conducted up to 2008, after which it was only done whenever a pump was damaged.

Prevention is surely better than cure, something any water operator should have known at the outset. No regular checks by the appropriate technical experts were carried out, and this was the primary reason for the breakdown. Even if Syabas employees did routine inspection, why did they not realise the pumps were already faulty, and thereafter immediately alert their superiors? In fact, it was revealed that one of the five pumps was already reported as faulty since last year and this was not addressed.

This brings us to the next issue of good governance. The water industry is regulated by SPAN (National Water Services Commission). Syabas has unfortunately demonstrated its inability to manage its equipment efficiently, when it should have investigated the root problem even before it became a problem by following SOPs and best practices.

SPAN together with its Ministry of Energy, Green Technology and Water should use this perfect opportunity to correct any inefficiencies in the water delivery system. Failure to reprimand only means it is silently supporting incompetency. It is not clear whether SPAN had in fact instructed Syabas (or rather, Puncak Niaga Sdn Bhd, the actual pump operator) to make urgent corrective measures.

Added to this is a revelation in the Auditor-General’s Audit Report for the operating period of 2009-2011, which showed amongst other things that the funds Syabas received for capital expenditure (capex) from the Selangor government were actually used for operating expenditure (opex). If such funds were necessary for the upgrading of water pumps, then they should not have been misallocated.

Syabas would have us believe that this has everything to do with the supposed water shortage in Selangor and the need for the monstrosity of the Langat 2 plant and Pahang-Selangor water transfer project. This doesn’t make sense, since the Langat 2 plant was slated for completion in 2014 anyway. The Wangsa Maju plant failure has nothing to do with Langat 2.

In earlier columns, I stated that this RM9 billion mega-project should be reconsidered in preference of other solutions like upgrading existing plants, rainwater harvesting, water recycling and treatment of Selangor’s raw water resources.

Some have also raised the question of why the Selangor government lays the blame squarely on Syabas when it holds 30% of its shares. Although this means attending board meetings and access to documents, Selangor is still the minority shareholder, and has no role in dealing with day to day operations. In fact, the federal government through its Finance Ministry Incorporated holds the golden share of Syabas, which allows them to flex some muscles. Nowhere in the concession agreement (which, by the way, is also signed by the federal government) does it say that maintenance of pump stations falls under the jurisdiction of the state government.

Finally, enter political drama. In a blatant fish-for-votes speech, Prime Minister Najib Razak promised to resolve Selangor’s water woes if Barisan Nasional is given the mandate to govern the state in the upcoming general election. This is most distasteful indeed, which basically says that until and unless Barisan retakes the Selangor government, the federal government will do nothing and sit idly by as the people suffer the misfortunes of an inefficient company.

Under Section 191(5) of the Water Services Commission Act 2006, the Minister has the right to determine what amounts to national interest issues, and this determination would be “final and binding”. This means the Minister – and through its regulator SPAN – would be empowered to make the best decision to resolve the water problems of Selangor, whether it means termination, restructuring, or migration to a new regime. Such action must be taken regardless of political support, and the people of Kuala Lumpur, Selangor and Putrajaya deserve better.

(First published in theSun, 25th January 2013.)

Tricia Yeoh blogs on triciayeoh.com

Malaysia after regime change

Crony capitalism in Malaysia: Breaking the business and political nexus

The intricate nexus between the worlds of business and politics has been an age-old tradition in Malaysia. Crony capitalism, a term to describe the intertwined relationship between business, politicians and the state, where individuals in the private sector benefits by obtaining licenses, concessions, government subsidies, other forms of protection from governments and appointments to key state owned enterprises through their close relationship with politicians and bureaucrats.

The main questions to ask in the event of a regime change are: Will it really ever be possible to extricate one from the other, given the context where this is an assumed norm? Second, how would a new government go about making these drastic changes?

There has been recognition of this problem by political players from both sides of the divide.

The Pakatan Rakyat (Pakatan) Shadow Budget admits, for example, that “Pakatan will face resistance from cronies that desire to perpetuate patronage and rent-seeking” when it begins to attempt open tenders and a more transparent procurement policy.

Prime Minister Najib Abdul Razak also announced that a new initiative under the Government Transformation Programme (GTP) would regulate financing for all political parties, where all funding must be channelled to an official party account. He said that “a proper receipt record” would “prevent corruption and misappropriation on a grass-roots’ level …”

The CEO of Pemandu (the Performance and Measurement Unit under the Prime Minister’s Department), Idris Jala, stated that a first tier of internal control would be developed, of a checklist of recommended actions for political parties to undertake to avoid the abuse of funding. A second tier of external control would require that “all federal and state government entities and statutory authorities cannot include any party member who is an office bearer on their tender board”, amongst others.

The academic literature on the business-politics nexus (known as rent-seeking) has been examined closely from various angles by numerous academicians such as Peter Searle, James Jesudason, Dan Slater, Alasdair Bowei, Greg Felker, Nicholas White, Terence Gomez and Jomo KS among others. These researches suggest mixed outcomes.

Nevertheless, the research recognises that the business circle exerts strong influence over the political players as do the political players over business, often times resulting in sub-optimal use of national resource such as diverting scarce resources away from productive use (to the awarding of white elephant projects, poor quality works, constant costs over-run and when the corporation selected fails to deliver, the government is expected to bail out these companies using public funds).

Ex-post, the lack of stringent laws and regulations – and the enforcement thereof – has led to the present predicament in which political parties are ultimately subjected to the demands of powerful corporate interests. But it is, nevertheless a symbiotic relationship. This has become a norm in Malaysian politics.

The solution seems clear: ensure there is only well governed arms length relationship between business and politics. But is this really possible as the historical roots runs deep originating from Malaya’s post-colonial transition and the Barisan Nasional’s economic nationalism?

Post-colonial politics and business

As Malaya was in its final years of colonial rule under the British, political alliances were taking shape between the Malays and the Chinese. The Chinese towkay (community and business leaders) entered politics through their party MCA (Malaysian Chinese Association)’s alliance with UMNO (United Malay National Organisation) in the 1950’s.

Both parties co-operated during the Kuala Lumpur elections of February 1952 because the “Selangor branch of UMNO lacked sufficient funds to fight the election”. Consequently, the MCA bore the bulk of the election expenses for the MCA-UMNO coalition up to the federal elections of 1955. MCA funds also helped to secure the Alliance’s electoral victory in the first elections for a fully-elected assembly in August 1959.

Chinese tycoons of the day therefore financed UMNO in its earliest beginnings, and a reciprocal relationship was hence born. The Chinese community would benefit from such a relationship by being appointed in key positions from where economic policy could be made: H.S. Lee as the first Minister of Finance, and Tan Siew Sin as the Minister of Commerce and Industry, in particular.

Quite apart from these governmental positions, members of the business elite would also receive commercial favours for their loyalty to the Alliance. H.S. Lee received a banking licence to establish the Development & Commercial Bank in 1966 and Tan Siew Sin became the chairman of Sime Darby in 1977. They were adept and capable businessmen, and earned their positions based on their performance – so it is difficult to say this was a direct result of their political relationships.

However, this blurring of boundaries between politics and business would set the stage for political parties to continue to receive funding from not just Chinese tycoons, but all tycoons regardless of race. Hence, even private sector players who were not part of the political infrastructure would require close connections with government figures to develop their businesses. Robert Kuok and Dato’ Nik Kamil, the latter of whose success inspired young Malay entrepreneurs to embrace the ‘jadi ahli politik untuk buat duit’ (become politician to make money) motto are such examples.

The crony capitalism trend persisted also in Sabah and Sarawak, where similarly the Chinese big businesses were more than willing to work with Malay-Muslim political power for economic and social gain. Khoo Siak Chiew, a leading logging baron, who helmed the Sabah Chinese Association (SCA) and eventually became a minister following Sabah’s incorporation into Malaysia, is an example.

Things have not quite changed since the 1960’s. What has changed is that where in the past, contracts, tenders or appointments were made based on ability and expertise, with political connection being the added advantage, today it is mostly about political connection and ethnicity. Government makes decisions not because they are the most competitive or capable but for other reasons. As such, political acumen has been an essential skill for individuals to possess, without necessarily having equal entrepreneurial or technical expertise.

It is unsurprising that the historical post-colonial Malaya, and the way in which political parties began, formed the very foundation of the current-day UMNO’s modus operandi, and that of its coalition partners. By being members of political parties in government, one increases the chances of one’s networking pool, especially to decision-makers within government.

Economic nationalism: New Economic Policy

The New Economic Policy (NEP) was used by the national government to benefit Bumiputera companies and business people, in the name of assisting the Malay community. Ironically enough, these companies would not be restricted to Bumiputera ones alone; even non – Malay entrepreneurs who were successfully able to “buy-in” to the system would also be rewarded.

Simultaneously, former Prime Minister Dr. Mahathir Mohamed was on a roll to internationalise the Malaysian economy. This he carried out by embarking on mega-projects. Large government-linked companies (GLCs) would then engage in joint-ventures with the government and international firms in these mega projects (e.g. North-South Highway, HICOM, Perwaja Steel, Malaysian Shipping Corporation, Putrajaya, the Kuala Lumpur International Airport, Kuala Lumpur City Centre, Cyberjaya, etc). In order for these large projects to be funded, the government relied on a significant amount of contributions from the national oil company, Petronas, as well as funding from corporate entities.

Political party financing

Given this backdrop of the post-colonial political formation and economic nationalism, the persistence of government to recognise wealth expansion of the Malay community, and desire to place Malaysia on a global growth map, it was only natural that the government and the private sector enjoyed a close relationship.

Former Prime Minister Mahathir Mohamed said that “the presence of (influential) Malays on various boards’ means … they are able to impart … know-how to new ventures launched by Malays”. However, the dominance of UMNO within the Barisan Nasional (BN) federal government, combined with the nexus of business and politics, has been corrosive.

UMNO traditionally relied on membership fees and donations from private individuals, as documented in Transparency International Malaysia’s (TI-M) new book “Reforming political financing in Malaysia”, launched in May 2010. UMNO grew to rely more upon its investments and business interests through ownership of corporations and shares. As mentioned earlier, early UMNO members consisted of teachers and the civil service, but the majority is now made up of entrepreneurs and corporate figures.

Former UMNO treasurer Tengku Razaleigh Hamzah recounted how he was tasked with finding investments for UMNO and acknowledged a covert political fund existed.

Barry Wain in his book claimed this fund was worth RM88.6 million in 1984. Former Prime Minister Dr. Mahathir told TI that he handed his successor RM1.4 billion worth of property, shares and cash. The Star newspaper contributes RM50 to RM60 million to MCA annually, and TI estimated MCA’s current assets to be RM2 billion.

TI’s research concluded that Pakatan’s coalition parties still depend on grass-roots support, raising funds through a combination of membership fees, fundraising dinners, donations, publications and forums. The Democratic Action Party’s elected representatives contribute a portion of their salaries and allowance to the party fund.

TI’s report stated clearly that businesspeople or wealthy individuals with vested interests are eager to give money to politicians in return for securing business favours, strengthening the argument that there exists a powerful nexus between politics and corrupt money.

Clearly, there is a need to break from this culture and norm of relying upon large business conglomerates to support political parties. It is well known that companies are obliged to sponsor events such as party elections, and state and national election campaigns. The danger of not addressing this very real problem is that no matter which political coalition comes into power, it is inevitable that the political leaders have to succumb to the demands of corporate interests.

Unless a better system exists in which political financing takes place through a more transparent and well-regulated process, this culture is bound to continue.

Can a new government change this?

The existing system (or lack thereof) of political financing has brought to fruition a culture of dependency upon the large business players. If there were to be a possible regime change, would the new government be able to circumvent such a system?

Political financing reform is key to ensuring that any government in place is not held ransom by private sector interests. The Pakatan Shadow Budget has outlined its clear position that it would break up monopolies and oligopolies in Malaysia should it come into power. Its goal is also to “free all government-linked companies (GLCs) from political interference” and that they would operate based on commercial priorities.

Pakatan’s list of monopolies to be either restructured or completely dismantled includes the business of Malaysia’s most powerful tycoons. Would the move to dismantle them succeed, first on the count of the resistance from the tycoons, and second on the count of their very convenient use as financial sponsors?

In the case of regime change, Malaysians must be cognisant that this deeply-embedded web between business and politics will not be easy to disentangle.

Even within the first 100 days, should the Pakatan government make initial efforts at change, it may not result in immediate improved outcomes.

For instance, a task-force would have to spend copious amounts of time examining the hundreds of lucrative contracts between government and private companies, separating the legitimate from the dubious ones.

Next, by virtue of the fact they have a contractual agreement; it will be extremely difficult to break these contracts immediately. Doing so would either mean penalties have to be paid, or multiple court cases would ensue between the corporations and government. This is the experience that the Pakatan state governments of Penang and Selangor faced when they came into power.

Second, selected existing civil servants who have already built their careers on these relationships would very much operate according to the existing mindset. Whether or not the same cronies are involved, the method of dealing with contracts and public procurement will be dealt with in much the same manner by them.

For there to be a distinctive change in the way politics is run, and to push for a more transparent and corrupt-free democracy, steps must be taken to deal with the current political-government-business nexus.

For the business world to be kept at arms length and independent from the political players, new laws and regulations that emphasise transparency and good governance must be considered. Although close relationships between the two will always exist, these regulations will help mitigate the negative effects resulting from this. The inclusion of the public’s intense scrutiny through transparency measures will allow the public to participate in the process of examining the political parties that claim to represent them.

Malaysians must be aware of the current systemic flaws. In doing so, they would recognise that change takes time to set in. It is absolutely crucial that a new government must seek to strictly regulate and enforce political financing, even if it is to its own political detriment. This would be necessary for the long-term strengthening of democratic institutions. The voting public must push for these changes to take place.

In the final analysis, dependency of politics on the private sector must be removed if we are to encourage a new way of being and doing government.

Tricia Yeoh works in market research and is former research officer to the Selangor Chief Minister. She continues to write and comment on Malaysian policy matters. Her book, “States of Reform: Governing Selangor and Penang”, will be published later this year.

This article was first published in New Mandala.