PARTI Keadilan Rakyat (PKR) vice president Rafizi Ramli has proposed that PKR members of Parliament (MPs) draft a law to regulate corporate bailouts using public funds.
According to the former Pandan MP, this specific law should stipulate that any such bailout must be approved by Parliament by means of an Act.
“For example, if the bailout involves ‘Syarikat Najib’ then a bill called ‘Public Funds to Acquire Syarikat Najib’ should be tabled and passed.”
Rafizi said that any subsequent legislation for the bailout can be used to impose clear conditions on the roles, penalties and remunerations on the original owners and top executives and can be used to block pay raises or bonuses for top executives or dividend payments for a specific period of time, for example.
“The tabling of such a bill is necessary to curb the practice of crony capitalism which has plagued various administrations so much so that each generation is faced with a series of bailouts by which the debts and losses are borne by the people for generations to come,” he added.
All bailouts involving public funds is wrong
Rafizi’s suggestion came amid an ongoing social media spat with former prime minister (PM) Datuk Seri Najib Razak who has been lobbying the Government to bail out the embattled Sapura Energy Bhd either through a loan or a takeover via state investment funds.
“All forms of bailout that involve the injection of public funds to save corporate companies is wrong and must be rejected regardless whether the company is a state-owned enterprise (SOE), a government-linked company (GLC), public listed companies with substantial public fund’s ownership or regular corporate companies,” he remarked.
He went on to note that bailouts would encourage corporate figures to look for shortcuts in making money and were akin to “privatising profits and nationalising losses”.
He noted that the selective use of public funds will only benefit certain segments of the society despite the fact that the large amount of money could have been put to better use by a larger group of people.
Putrajaya would also be “inheriting” firms that had chronic financial woes which were unsalvageable even with the injection of public funds, he added.
Cash-strapped Sapura Energy posted a net loss to the tune of RM8.9 bil – its highest ever – for the financial year ended Jan 31, 2022 (FY2022) from a net loss of RM160.87 mil for the prior financial year, The Edge reported.
Sapura Energy said it is now undertaking a massive debt restructuring involving banks, vendors and contractors.
Najib had previously suggested that the Bumiputera community could be adversely impacted if Sapura Energy goes bust with Amanah Saham Bumiputera holders potentially losing RM4 bil while 10,000 employees would lose their jobs.
Rafizi had immediately responded by urging the public to reject the proposal, claiming Najib had only wanted to help his friends.
According to Rafizi, Sapura Energy’s former CEO Tan Sri Shahril Shamsuddin had received RM983 mil in various payments from 2009 to 2018 when Najib was the PM.
In 2018, Permodalan Nasional Bhd (PNB) – which manages the savings of the Bumiputera community and is the parent of investment vehicles such as Amanah Saham Nasional Bhd (ASNB) – paid RM2.68 bil in a deal that increased its shareholding in Sapura from 12.6% to 40%.
After Sapura’s latest losses were published, Najib had urged the Government to protect the company from bankruptcy.
At 4.08pm, Sapura Energy was down 0.5 sen or 11.11% to 4 sen with 43.91 million shares traded, thus valuing the company at RM639 mil. – April 6, 2022
