[UPDATED] Sabah to allow ex-workers of bankrupt SFI to remain on premises

KOTA KINABALU – The Sabah government is allowing former workers of Sabah Forest Industries (SFI), presently under receivership, to continue living on the premises with the likelihood of eventually being re-employed, said a source in the government.

The source, who has first-hand information on the issue, said the state will re-employ the laid-off employees as part of its scheme on sustainable forest timber utilisation, processing, management, conservation research and development.

In fact, he said, the scheme is the very reason the Sabah government had put up the government’s notice of acquisition of the land on which the ex-workers are staying, and to take possession and control over it.

“The scheme is, in fact, the purpose of the land acquisition in accordance with Section 2 of the Land Acquisition Ordinance.

“(Putting up a notice) is a standard procedure following the Sabah government’s acquisition of SFI’s alienated land,” he said.

Earlier today, The Vibes reported that some 600 laid-off SFI employees were instructed to vacate their quarters at the former paper mill and estate at the end of October following the state’s move to take back the land. 

On September 5 this year, the Sabah Land and Survey Department issued a reclamation notice for the 46.033ha estate, which includes SFI workers’ quarters. The notice instructed families living on the premises to vacate the area within three months.  

The source said that upon the second publication of the gazette under Section 3 of the Land Acquisition Ordinance, Cap 69, the affected landowners or any interested parties are notified and served notice of the acquisition.  

The buildings and structures thereon shall be free of any encumbrances, vested in the government, and be deemed to have been surrendered by the lawful owner or legal interest thereof.  

“Therefore, vacant possession is deemed to have been delivered to the state government,” he said.  

The source stressed that the Sabah government will also address the issue of outstanding salaries fairly and equitably.  

He said he expects the administration to make an official announcement on this soon.  

SFI’s debt to bank risen to RM96 million

The source also claimed to The Vibes to have personally observed the SFI’s financial woes worsening in 2019 when the then Warisan-led state government frustrated SFI’s tender exercise by refusing to grant a new timber licence agreement to the successful tenderer, Pelangi Prestasi Sdn Bhd. 

He said the Warisan government further exacerbated SFI’s already dire financial position by forcing Sabah Development Bank Bhd to lend some RM80 million to SFI on an unsecured basis, allegedly to pay salaries.   

“That amount has now ballooned into a debt of over RM96 million and remains unpaid due to the fact SFI was and remains hopelessly insolvent. 

“It was the GRS (Gabungan Rakyat Sabah) government that has taken swift action to ensure valuable land and resources previously held by the now defunct SFI are brought back under the government’s control for the benefit of SFI’s workers and the people of Sabah,” he said.  

He added that SFI was wound up on November 15, 2021, for being unable to pay its debts and is now in liquidation. 

On September 14, 2022, SFI’s receiver and manager was charged in the Kuala Lumpur sessions court with criminal breach of trust in relation to his handling of SFI funds. 

Meanwhile, former SFI staff clerk Dayang Rosmawatye Salleh, who is among 600 people still living in SFI quarters, told The Vibes that the notice had left all the residents confused.  

“We were left in the dark after they put up the notice. No government officials came to explain what the notice means.

"We think this case will be the same with the electricity and water issue. At first, they told us that they will not be cutting our power and water supplies until our outstanding salaries are paid. 

“But just last week, we received electricity and water bills,” she said.  

“If the government is truly denying they tried to evict us from our homes, then they must be lying, because it was clearly stated on the notice. Plus, why didn’t they explain it sooner?”

In a statement issued by the Sabah Lands and Surveys Department around 8.15pm today, it confirmed that former SFI employees are allowed to stay on the premises, and will be eventually re-employed if they wish.

“Following the state government’s acquisition of SFI’s alienated land, it is standard procedure for the state government to deliver to SFI the government’s notice of acquisition as well as to take possession and control over the acquired land.

“SFI’s workers and general staff who are currently living on premises following the state government’s acquisition may remain where they are and will be eventually re-employed, if they wish, as part of the state government’s sustainable forest timber development scheme which, is the purpose of the acquisition in accordance with Section 2 of the Land Acquisition Ordinance,” the department said.

The department also said that the issue of outstanding salaries will also be addressed and resolved fairly and equitably during the same period. – The Vibes, September 24, 2022