Dr Mahathir-Tony Pua tiff calls attention to 2 mega projects

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The ongoing tiff between Dr Mahathir Mohamad and Tony Pua has called attention to the inner workings of the Pakatan Harapan (PH) administration during its 22 months in power.

Dr Mahathir set the ball rolling, claiming in his new book Capturing Hope: The Struggle Continues that the business community had complained about a political secretary who was arrogant and behaved like a minister during his tenure as prime minister.

He named Pua as the person at media briefings, claiming that Pua had spoken on behalf of the government regarding a megaproject when he had no authority to do so and even threatened a developer.

Pua was Lim Guan Eng’s aide when the latter was finance minister.

According to Pua, Dr Mahathir had not once sought to clarify any issues directly with him and never once gave him a chance to defend himself.

“His entire perception of me, I can now confirm, is painted and formed by the business circle he meets, and perhaps political sentiments fanned by the naysayers in Bersatu and Umno.

“My biggest disappointment, however, is the fact that despite being a prominent lawmaker of this PH administration, and a leader in the DAP, Dr Mahathir never once sought to clarify any issues with me.

“There was never even a casual meeting where he could cast an eye on me and make his own judgment as to who I was. He never once gave me a chance to defend myself. He didn’t trust the team elected by the people,” said Pua.

On December 7, Dr Mahathir told the media that he was informed by other businessmen, including a Chinese, that Pua was arrogant and had behaved as if he was a minister.

Pua has since responded to the accusations in a three-part statement.

A look into the two projects involved in Dr Mahathir’s first two claims:

The Exchange 106

Dr Mahathir recounted an incident where Pua had threatened a property developer, who was facing financial problems, involved in a joint venture project with the government to develop a multi-billion ringgit complex in Kuala Lumpur.

“This particular DAP adviser made this threat despite the fact that billions have already been spent, and he did so without reference to or getting any authorisation from the government,” he added.

The developer in question is Mulia Property Development Sdn Bhd, which is part of the Mulia International Group from Indonesia. The project is The Exchange 106, which is part of the controversial Tun Razak Exchange (TRX), a 1Malaysia Development Bhd (1MDB) legacy.

Mulia’s owner is a well-known wanted fugitive – Djoko Tjandra, also known as Joe Chan or Pak Joe.

The Najib Razak administration had signed an agreement to provide a loan to the developer based on certain conditions, including that the project will be handed over to the government should it not keep up with the schedule, in 2016.

Najib, then prime minister, had agreed to a RM1.8 billion fund to bail out the project via a government guarantee to Mulia, in exchange for a 51% “temporary” Finance Ministry ownership.

If Mulia fails to repay the loan within 36 months, the Finance Ministry will have the right to purchase the remaining 49% for RM1.

Exchange 106 went on to become the first project to be completed in the TRX.

Pua responded by saying that the nonagenarian has extremely selective memory and prefers to believe the words of a foreign tycoon, who has been convicted of cheating hundreds of billions of rupiah from Bank Bali in 2009, for forgery in 2020, and bribery in 2021.

“I have clarified that I have never threatened the developer referred to by Dr Mahathir, Djoko, because I have never met or spoken to him. All discussions and negotiations sanctioned by the then finance minister were led by top ministry officials. I was never present on those occasions.”

MRT 2

Dr Mahathir also mentioned the MRT 2 project when speaking of Pua’s “arrogance”, in particular the latter’s open letter to the directors of MMC-Gamuda in 2018.

Pua said the letter lived long in Mahathir’s memory.

“Even late in 2019, more than a year after the letter was published and the matters were long resolved, Dr Mahathir was still griping about it in his conversations with Lim.”

MRT 2, previously known as the Sungai Buloh–Serdang–Putrajaya Line, was a megaproject undertaken by the Barisan Nasional government and whose costs were rationalised by the PH government.

It was managed by MMC-Gamuda KVMRT Sdn Bhd, which is a joint venture between MMC Corporation Bhd and Gamuda Bhd.

MMC-Gamuda bagged the contract for an initial cost of RM28 billion in 2014, but the cost ballooned to RM39.35 billion or RM56.93 billion when land and other charges were included.

The Finance Ministry had said the increase was due to ringgit depreciation, scope changes, and line extensions to Bandar Malaysia.

MMC-Gamuda offered to complete the above-ground portion of the project on a turnkey basis at RM17.42 billion, lower than the projected cost of RM22.64 billion.

The PH government considered re-tendering the underground portion, but decided to retain MMC-Gamuda as the contractor on October 26, 2018, after lowering the cost to RM13.11 billion from RM16.71 billion.

The cost rationalisation saw RM8.82 billion pruned off the project, which costs RM30.53 billion from the prior RM39.35 billion. This translates into a 22.4% reduction of the original negotiated price.

Though savings were made, the project did see some changes such as the adoption of a turnkey model; allocation rationalisation of contingency, provisional and reimbursable sums; work scope rationalisation of electrical and mechanical systems; and, postponement of stations in Bandar Malaysia.

Pua said he does not regret writing the letter.

“I’ve no regrets about writing the open letter, even if Dr Mahathir is still pissed about it (so much so that he actually included it in his memoir).

“It says a lot about the man when he chose to not record the RM8.82 billion savings for the rakyat…under his premiership in his memoirs, but instead whine about an apparently irritating political secretary.”

Pua also said MMC-Gamuda bosses had direct access to the Langkawi MP, claimed that the company launched a social media campaign on the 20,000 job losses that may occur if the project is axed, and revealed the findings of an independent engineering consultant.

Gamuda Engineering has issued a statement regarding the accusations, saying that they are libellous and unfounded.

During the launch of Capturing Hope yesterday, Dr Mahathir called Pua a socialist who does not like businessmen.

“Businessmen by definition are capitalists, but he doesn’t like capitalists.

“He’s basically a socialist although I have a different idea. I believe that capitalists, with their investments, can create jobs but he thinks I’m doing it because they are capitalists. It’s not true,” said Dr Mahathir.

He denied that he favoured businessmen because of cronyism.

Earlier yesterday, Pua challenged Dr Mahathir to name the businessman who had called him arrogant.

He said this was so that he could “respond, explain or exonerate” himself.

“Like it or not, I spent the last few days pondering over which particular ‘Chinese’ businessman in Dr Mahathir’s circle of business friends I might have offended, who complained that I was ‘very arrogant’. To be honest, not many come to mind,” Pua said in a statement yesterday.

“Perhaps it might be better for Dr Mahathir to disclose who this complainant might be and let Malaysians at large be the judge of his accusations.”

Pua said he could only speculate that the Chinese businessman to whom Dr Mahathir referred was someone who had written to the prime minister in 2018 to extend his gaming concession by 30 years, in exchange for a RM150 million “licence fee” to the government.

He said this request was forwarded to then finance minister Lim Guan Eng for his consideration.

“The proposal was rejected outright.  I never met this particular businessman, nor was I involved in the decision-making on the proposal.

“I made it a point to avoid the businessman as far as humanly possible. I knew for a fact that he was lobbying certain other ministers for support even after the initial proposal was rejected.

“The fact that I was the political secretary and burdened with the myth – yes, it’s a myth spread by BN cybertroopers – that I was the ‘power broker’ behind the finance minister, I could very well be deemed ‘very arrogant’ for being extremely evasive,” he said.

He added that the businessman eventually succeeded in persuading Dr Mahathir to approve the deal in early January 2020, by doubling the licence fee offered.

However, the PH government collapsed a month before the deal could proceed.

“If this was indeed the ‘Chinese businessman’ who complained about my ‘arrogance’, then I would plead mea culpa.  But I would not have done anything any differently,” he added.

Pua said that he was only doing his job as the political secretary to the finance minister.

“Those who worked with me would know that my meeting schedules often ran to midnight, nearly seven days a week.

“I would listen and bring the proposals back to the minister for consideration. Many excellent proposals were sourced via these meetings.

“I would however avoid parties who were only interested in securing contracts via direct negotiation with the government. I would also avoid meetings where I could be seen as compromised – if the party was already participating in a government tender or if they were making dubious proposals – like for fancy cryptocurrencies.

“As a matter of habit, I tend to decline lunch or (sumptuous) dinner invitations from tycoons and businessmen because they take too much time, and there’s probably too much small talk,” he said.