[UPDATED] RM35.4 mil halls not first contentious projects under Muhyiddin’s watch

KUALA LUMPUR – The controversy involving a leaked letter detailing an approved allocation of RM35.4 million to build infrastructure in Pagoh has set tongues wagging over Prime Minister Tan Sri Muhyiddin Yassin’s motives.

The recent admission by the Prime Minister’s Office (PMO) that confirmed the contents of the letter, while clarifying that the allocation is meant for the construction of three halls, has done little to answer the question of why the sum is being spent in the first place.

While PMO under the stewardship of the six-term Pagoh MP may be content with explaining that the RM35.4 million is for the development of three public halls – the Gersik hall in Tangkak (RM13 million), Bukit Pasir community hall in Muar (RM16.66 million) and Bukit Kepong community centre, also in Muar (RM5.77 million) – Muhyiddin’s track record with regard to controversial projects while serving in various cabinet posts since 1995 is now under the spotlight.

Here is a list of such projects that took place under Muhyiddin’s watch:

National Feedlot Centre (NFC)

Muhyiddin was agriculture and agro-based industry minister when he signed the approval letter for this project in 2006.

Under the approval terms, the National Feedlot Corporation (NFCorp) was awarded a RM250 million federal government soft loan for the NFC project, a cattle-rearing venture intended to reduce Malaysia’s reliance on imported beef.

The project was named in the 2010 Auditor-General’s Report over its missed production targets, among other discrepancies.

NFCorp is a private company owned by Agroscience Industries Sdn Bhd, with participation from the government, and headed by chairman Datuk Seri Mohamad Salleh Ismail, the husband of former Wanita Umno head Tan Sri Shahrizat Abdul Jalil.

Following an exposé by PKR’s Rafizi Ramli in 2012, NFCorp was embroiled in a scandal that saw Salleh being charged in March that year with two counts of criminal breach of trust involving RM49.7 million in the company’s funds.

NFC, which has since become a white elephant, has been accused of abusing the government soft loan for non-core business activities, primarily in property investment.

Salleh was acquitted in November 2015, following his lawyer’s letter of representation to the Attorney-General’s Chambers.

The government’s suit against NFCorp is ongoing at the high court.

Despite admitting to signing the approval letter, Muhyiddin in 2018 said he was unable to recall updates regarding the failed project. He also said funds for the project were not channelled through the ministry following the approval.

Muhyiddin was made to respond to the issue after a slew of criticism against him for approving the project. 

His critics included DAP veteran Lim Kit Siang, who said in a 2011 blog post that then deputy prime minister Muhyiddin should bear responsibility for the fiasco. Then Special Affairs Department director-general Datuk Mohd Puad Zarkashi also demanded that Muhyiddin not remain silent on the NFCorp issue.

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Then education minister Muhyiddin initiated this project in 2011, aimed at providing at least 10,000 government schools with high-speed 4G connectivity and an online learning platform with the Frog Virtual Learning Environment (VLE).

The RM4.47 billion project awarded to a unit of YTL Corp via open tender was supposed to be implemented in three phases over a 15-year period.

However, according to a National Audit Department report in 2015, the first phase was executed poorly due to delays in providing internet connection to users’ sites, and steering and technical committees were not established at the ministry level to oversee the project.

It was also learnt that YTL Communications had been paying a far lower rent for its telecommunications tower sites, following an “intervention” by the minister on behalf of the group.

Despite these findings by the Public Accounts Committee (PAC) during the Barisan Nasional administration in 2016, prompted by numerous complaints by schools on poor internet connection, the government failed to impose any penalty on the company.

The Pakatan Harapan government decided to terminate the agreement by June 2019, and then education minister Maszlee Malik announced a switch to the Google Classroom platform from Frog VLE.

YTL’s internet service package in the original deal has been replaced with an interim package with three providers, namely Telekom Malaysia Bhd, Celcom Mobile Sdn Bhd and Maxis Broadband Sdn Bhd.

PAC in November last year announced that it will conduct a probe into the project, which cost taxpayers RM2.71 billion between 2011 and 2019.

Pagoh Higher Education Hub (HPTP)

Considered Muhyiddin’s pet project in his constituency, HPTP was approved by the cabinet at its June 24, 2011 meeting, and launched by Muhyiddin, the then deputy prime minister and education minister, on September 15 the same year.

The project’s cost, according to Muhyiddin himself, was expected to be between RM5 billion and RM6 billion, and it would be carried out in several phases.

The development of the first phase under a Johor-implemented private fund initiative would involve four local public institutions of higher learning, namely Universiti Tun Hussein Onn Malaysia (UTHM), International Islamic University Malaysia (IIUM), Universiti Teknologi Malaysia (UTM) Research Centre, and Politeknik Tun Syed Nasir Syed Ismail.

It was reported that Sime Darby Property Selatan Sdn Bhd was given the right to design the hub according to specifications defined by the government, and to build, set up and maintain the facilities with financing borne by the concessionaire.

The concession agreement involving the development of 404.7ha for the four components of the project, namely polytechnic and shared facilities, UTHM, IIUM and UTM, was signed on November 7, 2012.

Additionally, the hub would be equipped with centralised shared facilities, and a water district cooling system in all buildings.

However, the first series of the 2018 Auditor-General’s Report showed that HPTP was unable to fully operate in order to achieve its intended objective.

“This is due to weaknesses in planning and monitoring at the Education Ministry/Public-Private Partnership Unit level, as well as project implementation by the concessionaire.”

Among the highlighted weaknesses were poor supply of teaching equipment by the concessionaire, inconsistent student intake as per the capacity of the facility, and poor management of the Computerised Maintenance Management System, which is meant handle the registration of the management’s assets, maintenance and complaints by the concessionaire, thus triggering a conflict of interest.

Stamford Holdings Sdn Bhd

The first controversy involving Muhyiddin in his nine-year stint as Johor menteri besar (1986-1995) was when Stamford reportedly applied to the state government in 1984 for permission to develop a parcel of land belonging to the company.

However, the state government led by Muhyiddin only took notice of the application in 1988, when the company alleged that its directors met businessmen Tan Sri Syed Mokhtar Albukhary and Yahaya Talib, who purportedly introduced themselves as business associates and friends of the then menteri besar.

Various media reports highlighted that Syed Mokhtar and Yahaya created a joint venture (JV) company to develop 714.7ha of the land by late 1989.

Following the set-up, the Syed Mokhtar-led firm took a 30% share, with the rest held by Stamford, after both parties signed the JV agreement.

Based on the deal, the JV reapplied for permission to develop the land, and obtained speedy approval, according to Stamford’s court filing.

The initial venture thrived when the land was successfully developed. However, in 1992, Stamford alleged that Syed Mohtar, Yahaya and Muhyiddin approached its directors to develop the remaining 2,638.5ha.

In contrast to the first agreement, Syed Mokhtar, Yahaya and Muhyiddin set new terms giving themselves 70% of the JV, which Stamford refused.

Following the refusal, Stamford claimed that it received threats, one being that Muhyiddin allegedly called its directors, saying the land acquisition papers by the state were on his desk, ready to be signed, should they fail to comply. 

The warnings were allegedly repeated by interested parties as well.

Despite the alleged threats, Stamford remained adamant, continuing to reject the new terms. By July 1994, the Johor government had acquired the land on behalf of Johor Islamic Economic Development Corporation.

After that, Stamford sued the state government, as well as Syed Mokhtar, Yahaya and Muhyiddin, alleging that they conspired to acquire its land unlawfully. 

Stamford won the first round of the civil suit before the Johor Baru High Court struck it out in 1995, stating that the company had no reasonable cause of action against the defendants.

It then took the case to the Court of Appeal. Details of the case were published around the same time in Asiaweek, whose report pointed to Muhyiddin’s threat to Stamford directors. The publication also claimed to be in possession of a recording of the phone call.

Despite publicly denying the report, Muhyiddin did not take legal action against Asiaweek.

The Court of Appeal in 1997 overruled the Johor Baru High Court’s decision, allowing the civil suit to proceed, subject to an appeal by the defence.

As the case reached the Federal Court by 1998, all parties agreed to settle the dispute out of court, with a final sum of RM400 million agreed as compensation to Stamford.

Muhyiddin has repeatedly denied his involvement in the scandal, and there were no further investigations launched against him on the issue.

Given that these projects under Muhyiddin’s watch have resulted in huge losses of taxpayer monies, the latest plan to build the three halls should be further scrutinised in the interest of the people. – The Vibes, January 25, 2021