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A guide on what not to do during the #MH370 crisis

There are so many speculations on the recent crisis pertaining flight MH370 which could distract and hamper the search and rescue activities currently underway in the South China Seas.

Fortunately, the management of this crisis has been handled very well by Malaysia Airlines and the relevant authorities. With the Department of Civil Aviation taking charge of the search and rescue missions, it is commendable on the part of the agencies involved to remain professional in their duties.

The management of the crisis could have gone either way and it is a mark of true professionalism that Malaysia Airlines so far is on the dot in the proper procedures in handling this serious incident. Below is an article from the Business Insider which could have been taken as a case study on what not to do during an aviation crisis.

Asiana Airlines Needs Serious Help With Crisis Management

As the FAA and NTSB continue to investigate the July 6th accident in which 3 were killed and 182 were injured at San Francisco International Airport (SFO), crisis management experts are scratching their heads at the perplexing response of Asiana Airlines.

Crisis Management protocols

When there is a crisis, the proper procedure is for PR-savvy company representatives to talk with the public through the media to reassure them that everything is being done to investigate the cause and insure the safety of the airline and the wellbeing of its passengers.

The idea is to get ahead of the story and make current and future customers as comfortable as possible in doing business with the Airline. As Korea’s second biggest airline, Asiana needs to make every effort to take care of its passengers and protect its reputation while allaying the fears of the flying public.

Asiana’s response

Asiana, however, has done the opposite of what crisis management protocols suggest. With the exception of a brief apology to victims and families a day after the crash, Asiana has been largely silent. When CEO Yoon Young-doo arrived at SFO airport 3 days after the accident, he declined to comment. Even more surprising, the airline did not have a trained public relations representative accompany the CEO to address the media either. The following day, six of twelve flight attendants appeared at a news conference, but none of them said a word, and some hid their faces. It appears they don’t know that when you are silent, many in the public think you are hiding something. While lawyers often recommend you don’t talk, marketers know that silence is the opposite of what a company faced with such a crisis should do.

Attempt to silence passengers

What’s even worse is the Airline has instructed passengers not to talk with anyone. On Wednesday, CBS This Morning featured a story about the Xu family who told reporter Carter Evans in an interview he taped on his iPhone that the Airline controlled nearly every aspect of their lives and told them not to speak with the media. In fact, when the reporter arrived at their hotel, airline security tried to prevent him from speaking with the family. Since these efforts to stifle the media appeared on camera on a major news broadcast, they supported what the Xu family was saying and raised further suspicions about Asiana.

Pointing fingers

Even though the pilots involved in the crash were novices landing and supervising the landing of a Boeing 777 at SFO, they pointed the finger at the automatic speed controls of the plane. According to the head of the NTSB, there are no signs of failure of the automatic speed controls or other automatic flight equipment on the plane that crashed. Such accusations by the pilots do nothing to inspire public confidence – especially since the early evidence points to pilot error as a potential cause of the accident. Also, the fact that this is the first fatal accident involving a Boeing 777, which has a record of being one of the safest planes in the sky, makes the finger-pointing even more suspicious.

Risky Business

While flying is the safest form of travel, it is a risky business for those involved in making and flying the planes. When bad things happen, the best companies can do is to quickly figure out the problem and be forthcoming with customers. What can any business learn from this latest incident involving Asiana Airlines? Employ the fact procedure to protect your reputation.

    • Admit the problem, and apologize if necessary (do not “point the finger” at others because it is likely to compromise your credibility).
    • Limit the scope (in this case put the incident in perspective and provide data that shows that flying on a Boeing 777 from Asiana is very safe).
    • Propose a solution so it will not happen again (if it is found to be the cause, a more rigorous training and pilot supervision program would be the solution).

If implementing the fact procedure is premature

In a case such as this when the cause of the accident is not yet known with certainty, the airline should not be silent as Asiana has been. And, it should not try to control what the passengers say to the media. This just fuels suspicion. It should make it clear to the flying public that it (1) is doing everything in its power to cooperate with the investigation and (2) will continue to do whatever is necessary to insure the safety of its airline and the wellbeing of its passengers.

Since Asiana has proven to be inept in this crisis, and some believe this may be a cultural issue, it should hire US crisis management experts for advice to protect its reputation going forward.

Read more: http://www.businessinsider.com/asiana-airlines-accident-response-continues-to-be-just-plane-stupid-2013-7#ixzz2vY1AbuMP

How Pakatan Rakyat aspire to finance itself

Most people think that Pakatan Rakyat politicians are human beings with excellent moral values and integrity. They portray themselves as the people’s saviour against Barisan Nasional politicians which they accuse as the corrupt devils greedy for riches.

In actual truth, the politicians in Pakatan Rakyat are as greedy and as corrupt as the ones they are accusing. And since they always arrogate themselves as the epitome of goodness, this hypocrisy renders them even worse than their Barisan Nasional nemesis.

Take for instance Rafizi Ramli’s overzealousness in trying to create the perception that the LRT extension project, which had been awarded to George Kent – Lionpac consortium, was dubious and it should have been awarded to Balfour Beatty consortium instead.

And it was later discovered and exposed by this blog that Balfour Beatty’s main partner is Ingress Corporation Bhd whereby the main player in the latter is a close crony of Anwar Ibrahim.  Luckily, the motive of Rafizi Ramli’s incessant accusations were uncovered and since then, he has been quiet about this issue.

Another example is how Tony Pua is belittling 1MDB and backed YTL over the tender of a power project. The blatant  support for a corporation to win a multi billion was so unashamedly done, eyebrows were raised as to why a senior DAP politician would do that. Ironically, DAP which is very much known for its principles on socialism is now seem to be capitalist in nature. Are they shifting their raison d’etre when big money is involved?

Hypocrites rule the roost and Pakatan Rakyat’s lust for money and opulence can be seen openly. Otherwise, why would DAP politicians in Selangor who should be a socialist in nature, demand near 300% hike in their salaries?

The latest incident involve water crisis in Selangor will raise more eyebrows. For a start, this is the chronology of the whole fiasco:

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PKR politics as we all know is very much a carbon copy of Umno’s but in one huge difference – they do everything much worse.

On Wednesday, the Federal and Selangor governments signed a Memorandum of Understanding that will facilitate the implementation of the Langat 2 water treatment plant project and the takeover of water assets in the state.

The MoU breaks a five-year impasse that has stalled the implementation of water projects in the country’s most industrialised state. - Source

However, PKR strategy director Rafizi Ramli had claimed the party was in the dark about the MoU, and said the state executive councillors would be asked to explain.

PKR deputy president Azmin Ali said the Mentri Besar would be summoned to brief Opposition leader Datuk Seri Anwar Ibrahim once he returns from Japan.

“We want to hear Khalid’s side of the story as many are still in the dark about the details. We are concerned over whether there would be an increase in water tariff prices and whether there would still be free water for Selangor,” he said yesterday.

Anwar’s official Facebook page showed that the Permatang Pauh MP is currently in Japan.

It has been reported that several PKR leaders were not informed before the state signed the memorandum on the water restructuring exercise while it is unclear if Khalid has the backing of the top Pakatan Rakyat leaders over the deal. - Source

Zaid Ibrahim had a different take on why top PKR politicians was in the dark about the deal:

Kajang by-election contestant Datuk Zaid Ibrahim said that PKR adviser Datuk Seri Anwar Ibrahim got “checkmated” by Selangor Mentri Besar Tan Sri Khalid Ibrahim on the water deal.

Zaid said it was too late for Anwar – who is apparently setting his sights on the office of mentri besar – to influence the deal that has just been struck between the Federal and state governments.

“It is too late. It is a checkmate for Anwar,” he told a packed press conference at his residence here yesterday.

However, PKR strategy director Rafizi Ramli had claimed the party was in the dark about the MoU, and said the state executive councillors would be asked to explain.

But Zaid believed Anwar knew the MoU would be signed.

“I am sure Anwar knew about the deal …in the event a new mentri besar takes over from Khalid, he cannot do anything to ruin the deal.

“I think what Khalid did was right and I agree with him.

“At least the future of the Selangor people would be more secure with the end of the privatisation of water supplies,” he said. - Source

Zaid Ibrahim’s press conference can be seen as below. There are many sneak peaks on what Anwar Ibrahim intend to do once he will become Menteri Besar of Selangor inside the video.

And today Khalid Ibrahim told the public on why the water deal was made in such clandestine manner. Basically, he did not want the trio of vultures – Anwar Ibrahim, Rafizi Ramli and Azmin Ali to take over the water deal for their own benefit. This triad of political schemers had been working against Khalid Ibrahim since day one of the Kajang plot.

Some PKR top brass wanted to set price of water assets, says Khalid

SHAH ALAM: Selangor Mentri Besar Tan Sri Khalid Ibrahim disclosed that there were party leaders from PKR who were trying to influence the valuation of the water assets in the state.

He said some party leaders had introduced him to a few people who were trying to make their case as to why the pricing of the water assets should be higher.

“I have been an investment banker for so long that I look at the principle of valuation before determining the price (of the assets). I stood by my principle of valuation and set the price at RM9.65bil.

“These people wanted to set the price and wanted the valuation to justify their price,” he said in an interview with The Star yesterday.

Khalid also explained why the mechanics of the deal could not have been revealed to all and sundry in and outside of the party before the agreement with the Federal Government was signed on Wednesday.

He pointed out that the information, if revealed, would have an impact on the price of the stocks related to the water assets.

“I was also concerned about possible abuse of information and insider dealing. These are reasons why PKR leaders were not informed ahead of the signing on the water deal between the Selangor state government and the Federal government,” he said.

Khalid said he did not inform his party leaders due to those reasons to ensure that the implementation of the transaction was right and adhered to proper corporate governance.

Like George Orwell’s Animal Farm – the ones who think could be the saviour, will eventually become worse than the alleged oppressors once they have tasted power.

The snapshot on global economy and the local economy

If anyone of the readers here haven’t read the Confessions of an Economic Hitman book, here is a Youtube video where the author summarily describes the content of the book in about 11 minutes.

Locally, our own economy is floundering.

None of the great economic consultants employed by the Prime Minister are able to find the right formula to revitalise the local economy yet. Today, the blogger Darah Tuah wrote a snapshot on the economic position of this country right now particularly the economic relationship between the bumiputera and the non-bumiputera. The blogger gave recommendations as well.

Maybe PEMANDU and other advisers can learn a little bit of something about it too.

Please have a read HERE.

Thank you.

Paintings and credit cards of Khazanah Nasional

The Prime Minister’s pride and joy, the invulnerable Khazanah Nasional was under the microscope of Auditor General as well.

Thank you to a commentator by the name Wanita Bukit Tinggi who highlighted the Auditor General’s findings on this company where Dato Sri Najib Tun Razak is also the Chairman

AG’s Report: Contractor failed to deliver RM46m component of shrimp project

PETALING JAYA (Oct 1): The Auditor-General Report 2012 has revealed that the contractor for the Integrated Shrimp Aquaculture Park (iSHARP) in Setiu, Terengganu, has failed to deliver the sea water intake system which cost RM46 million.
 
The contract was awarded to Ranhill Engineers and Constructors Sdn Bhd by Khazanah Nasional Bhd’s subsidiary Blue Archipelago Bhd, which manages iSHARP, to construct its biggest component for the shrimp aquaculture park.
The audit revealed that the project was not completed by Ranhill and the termination notice was issued on Aug 16, 2012. The contract termination notice was issued to Ranhill on Dec 3 last year with immediate effect.
On Nov 15, 2011 Ranhill claimed that work progress was at 97.5% although Blue Archipelago stated that the work progress by Dec 3, 2012 was only at 92.1%. Up till Dec 3, Ranhill has received RM42.21 million in interim payment.
Blue Archipelago’s explanation to the auditor-general was that the contractor lacked equipment, had financial difficulties, the main contractor did not pay the sub-contractors and the scope of work required specialist sub-contractors.
To make matters worse, on Sept 8, 2011, a functional test found that an underwater pipe had burst and Blue Archipelago had to install a temporary structure for sea water intake in order for the shrimp aqua culture farms to operate.
“Since the date of the audit, they are still using the temporary structure. The audit has also uncovered that due to the delay in completing the project, the project site was left without adequate security which has led to cables being stolen at the pump house and is a danger to the public,” the report stated.
Khazanah’s reply to the auditor-general stated that it had utilised its performance bond against Ranhill on Dec 2012 for the sum of RM2.3 million.
Legal action has also been taken against Ranhill for breach of contract and liquidated ascertained damages claim was due to be completed by June 30 this year.
Strangely, Blue Archipelago continued to hire Ranhill as a subcontractor to complete the security fencing surrounding the project site and the nearshore manhole. This section of the project was expected to be completed by Aug 30 this year.
Physical examination at the sea water intake system pump house also revealed that there were several items in the Bill of Quantity worth RM83,966 that were not completed by the contractor.
The consultant claimed that it was a variation order (VO) omission, but further investigation by the auditors revealed that there was no such VO issued to Ranhill.
Khazanah has informed the auditor-general that Blue Archipelago and Ranhill had begun discussing the final accounts which was expected to be completed by June 30, 2013.

If Khazanah Nasional cannot even complete a shrimping project, do we honestly think they can make money in other ventures? Remember the Air Asia – MAS share swap? That apparently was the pinnacle of their intelligence.

The point is, although Khazanah Nasional was given the thumbs up by Auditor General for achieving profits every year, they gain most of their income from dividends of their shareholding in 86 companies. This business model does not need much brain power. How to increase our profit this year? Just sell Proton!

But we believe getting profits every year will be the main lullaby for the Khazanah Nasional to lull the easily impressed Prime Minister into his slumber.

But what the Prime Minister doesn’t know that there are a pile of stench under his nose which had escaped his attention but unfortunately didn’t escape the people’s notice.

Too bad because he was supposed to be the Chairman and ultimately responsible for the propriety Khazanah Nasional’s management staff.

RM1.26mil in charge card use by Khazanah staff

Certain individuals in the government’s financial arm, Khazanah Nasional Bhd, are still allowed to use its corporate charge card despite Khazanah failing to declare its expenses from the earlier months.

As a result, unrecognised expenses on charge cards issued to Khazanah Nasional accumulated to RM1.26 million last year alone, the highest amount in four years.

This comprises unpaid balance in excess of one month at RM487,317; a sum of RM291,400 for two months and RM485,187 over a period of two to six months.

In 2009, the amount of unpaid dues was RM610,902; while in 2010 it dropped to RM270,330 and it hiked to RM726,462 in 2011.

The audit report states that based on a financial communication note dated June 1, 2006, American Express charge cards were issued to directors and the chief executive of Khazanah Nasional. As of Dec 4, 2012, there were 106 such charge cards issued by Khazanah, with no limit on the usage.

The report also says that the charge card users have been reminded to prepare an analysis of their monthly expenditures, verify the expenditures with the receipts attached and to get approval from their heads of department.

“If the expenditures are not approved, the payment will be obtained from the card holders by cutting their salaries. Failure to provide an analysis and verification for three times would result in such privileges being revoked,” the report says.

The auditor-general also found there were some Khazanah staff who failed to send or declare their monthly expenses, resulting in the unpaid RM1.26 million in card charges.

According to explanations from the Khazanah officer responsible, the balance has been settled by Khazanah despite the staff not declaring their expenses.

Khazanah further explained that it had conducted an internal audit on the expenditure claims between 2011 and 2013, and the failure by those responsible to send in their lists of expenses was also discussed.

The staff may use the corporate credit card even though they failed to declare the expenses for the month before. There is minimum risk in this, since Khazanah can cut the salary of the individual concerned to recover the expenditure.

Khazanah added that it would take action to stop the use of the corporate charge card of staff who keep failing to declare his or her expenses.

However, the auditor-general said failure to file the monthly expenses declaration was improper.

Artworks not properly kept.

The report also found that Khazanah had purchased 93 artworks worth RM6.4 million.

Of the amount, 55 works of art costing RM3.05 million that were purchased since 2005, have not been properly displayed or kept in a proper manner and there are concerns that these could be damaged.

Khazanah in its reply in May and June this year said it was planning to place the artworks at a proper room on the 32nd floor of its office block and also in its new offices overseas.

It also plans to change the location of the existing paintings and for all the artworks to be placed after renovations to the interior decoration of its office, which was approved this year.

The renovations should be completed by the end of the year.

The auditor-general also said all the Khazanah assets needed to be fully utilised to justify their purchase.

On a positive note, the auditor-general commended Khazanah for making profit for the fourth consecutive year.

The bosses in Khazanah Nasional thinks the people’s money that we pay every month as income tax are something which they just can burn in a blink of an eye. RM64 million for 93 paintings?!

That is averaging about RM69K per painting! On whose God given right was it that they can just buy expensive paintings and waste it by not keeping it properly?

If that doesn’t make your blood boil, then the fact that 106 credit cards with unlimited ceiling are issued with impunity must take the cake.

This is a disgrace. Apparently, dishonourable men with no qualms in burning money can be held in high esteem by our Prime Minister.

So what are they going to do with the credit cards and the paintings? Business as usual? Issue more bonuses to the credit card users, painting buyer and the Board of Directors of Blue Archipelago Bhd?

That was precisely what they did. After all, they achieved profitability every year.

Thank you.

Brief Outlook on AG Report 2012

The much awaited Auditor General Report was published recently and the nation is gripped with unearthed stories about mismanagement (again), unrealistic purchases (what’s new?), inefficiencies as well as wastage.

We should really brand the momentous AG announcement as a national transparency day of sorts when discoveries like the ones exposed recently are highlighted for all can see.

What dumbfounded the nation is the fact that these findings are nothing new and had been going on for years but astonishingly, nobody in the audited government agencies learnt anything from past mistakes! Is the AG Report being treated as a insignificant memo by the misbehaving departments? Won’t the junior officers take heed of the mistakes made by their senior management about these gross mismanagement?

Leading the pack for inefficient spending would probably be the Ministry of Education:

Security in schools sees RM2bil go down the tube

The 2012 Auditor-General’s Report has revealed severe mishandling of RM2.051 billion with regard to hiring security contractors for schools between 2010 and 2012.

From poorly prepared contracts to hiring of septuagenarians as security guards, the auditor-general said the management of security services in 35 schools and hostels surveyed was generally unsatisfactory.

The audit, which involved schools in Selangor, Perlis and Sabah, found that the contracts were not uniform and did not state specific requirements set by the Education Ministry.

In some schools, the audit found that contractors had breached the terms of their contracts by hiring security guards who are too old, unfit, dressed inappropriately, ill-equipped and had not been subjected to background checks.

Nineteen of the 35 facilities visited by the audit team did not have anyone guarding the entrances and people were seen entering and exiting freely.

The audit team found that the Education Ministry was not keeping proper tabs on the implementation of the security project and failed to penalise errant contractors.

Now who is the contractor? We would think that those who are manning the tender and the contracts department in the ministry would have been a seasoned disciplinarian by now and is aware that the audit department will be breathing down his/her neck just to ensure that the security contracts are running efficiently. But obviously, we cannot train the civil servants in charge of this important task to be honest and diligent. In the end, payments are duly made without any regard to the delivery of services.

Another governmental arm which wasn’t performing was the police:

Police lose weapons, Customs men lose shoes

The Auditor-General’s 2012 report reveals that the Royal Malaysian Police Force recorded a total of 309 missing items in the form of weapons, handcuffs and cars.

It also reported that the Royal Customs Department wasted a whopping RM600,000 on 7,659 pairs of shoes that were not according to specification and were then badly damaged during prolonged storage.

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The items missing from the police force were recorded between 2010 and 2012, resulting in losses amounting to RM1.33 million.

The auditor-general reports that handcuffs topped the list of missing items at 156, followed by 44 weapons and 29 police vehicles.

Although the amount is small, the fact that weapons can be missing from the police force shows that there is a severe lack of controls in the police department and this doesn’t just involve money but it involves public security issue as well. Where did all the weapons go? How could they have lost it? From now onwards, KDN should really look into their SOP because if from 2010 to 2012 we lost 44 weapons, imagine how many had sifted through the cracks in years before that.

Then there is this incinerator project which not many know of:

Incinerator projects cause millions to go up in smoke

The National Solid Wastes Management Department (JPSPN) spent RM199 million on incinerators over the last four years, and then found there was no expertise to operate such machines in Malaysia.

All four incinerators at tourist spots in the islands of Langkawi, Pangkor and Tioman and in Cameron Highlands saw construction delays of two to three times their original schedules.

And even after completion, the Auditor-General’s 2012 Report says, three of the incinerators were not operated for 223 to 642 days, all because of the lack of expertise.

A fifth incinerator planned for Labuan was scrapped.

So basically RM200 million was spent on something we don’t really know about. On top of that, it was unused for up to two years because the person in-charge do not know how to find ways to operate it. For two years they presumably tried to find people who can make the incinerator worked, but alas the search was futile. Yes they could find people who can build it, but they couldn’t learn or find people who can operate it. Two years.

Bear in mind all this money wasted came from Budget 2012 which was made in 2011. May we suggest the Treasury to look into the numbers again and prepare a much lower budget for the agencies above for Budget 2014? From the lackdaisical attitude and their cavalier approach towards handling other people’s money, surely they should not hold a lot of money to begin with.

Next is the issue on the police force again:

Costly planes, but grounded because no funds

Between June 2008 and December 2010, the Malaysian police purchased five Beechcraft King Air 350 aircraft for a whopping US$58.25 million (RM175.24 million) for their Air Wing.

The planes were supposed to facilitate the upgrading of the nation’s air security.

However, within less than five years of usage, one of the planes had to be grounded for eight months, between September 2011 and April 2012, while another could not be used between June and November 2012.

Furthermore, out of the five, only three aircraft have been delivered so far.

The project was awarded after direct negotiations with Hawker Pacific Airservices Ltd, through its agent  EZ Aviation Sdn Bhd.

5 planes costing RM175 million that means each plane is averaging RM35 million. We could understand if the cost includes maintenance for the next 10 years but if it doesn’t then RM35 million for a twin turboprop aircraft at a base price of USD6 million (according to the plane’s website) is way too much.

But that is not the least of the problem. The fact that two aircrafts have not been delivered until now should ring some alarm bells from the police’s procurement department. But obviously someone was sleeping on the job.

Of course the mother of it all is the fact that some people in RTM thought they could get away with this:

Clocks, scanners and “miscellaneous items” cost RTM RM9m, up to 7,200 times over budget

The Broadcasting Department blew its budget spending RM120,210 on clocks and scanners alone, thus overpaying for these items by thousands of times beyond its actual cost.

Despite budgeting RM100 per unit for a clock and RM200 per unit for an A4-sized document scanner, the Auditor-General found that the Broadcasting Department spent RM3,810 per unit for “branded” wall clocks and RM14,670 per unit for the scanners.

In the 2012 AG Report, it found the department bought 20 branded wall clocks and three scanners for national broadcaster RTM’s offices in three states.

The department paid RM76,200 for the clocks, which was 3,810% above its estimated budget, and RM44,010 for the scanners, which was 7,235 times more than its initial budget.

The department also bought five scanners for A3 sized documents at an inflated price of RM20,630 each, 103,150% more than its estimated budget of RM1,000 each.

Although the ministry had explained on the use of those clocks, they were silent on the RM20,000 scanners. Anyone would be hard pressed to explain what kind of nuclear powered scanner they have bought.

Heads of department should really take leaf on how private companies are saving money. They treat their money like their children’s money. We have known so many stingy CEOs, prudent CFOs, very strict tender committees and a well disciplined procurement department. All in small, medium, and large private companies. Do you think the CFOs in YTL, Hong Leong Group, throw money just like that?

We need to look at ourselves and learn the concept of saving money which doesn’t belong to us.

Lastly is the bonus payouts by the GLCs. Although this is not mismanagement per se, but it is worth mentioning.

Bonus for losses, the GLC way for rewarding employees

Seven government-linked companies (GLCs) rewarded its employees with fat bonuses despite recording a combined loss of close to RM2 billion in 2011.

The Auditor-General Report today stated that Syarikat Prasarana Negara, an infrastructure company which had the highest recorded deficit of RM763 million among the group, gave its employees between one-and-a-half and two months bonus each.

The report also found that MIMOS, the country’s research centre, was the most generous of the group, by giving out between two and three months bonus to its employees, despite making a RM4.6 million loss in 2011.

Meanwhile, employees of KTM received the least with the railway operator distributing ex-gratia payments of a half-month’s salary or a minimum of RM500 in the same year. The company made losses of RM103 million.

The other companies which lavished its employees with bonuses despite making losses were Amanah Raya, Jambatan Kedua, Indah Water Konsortium (IWK) and Cyberview.

Now this is a catch 22 situation. The GLCs which provide services to the people are generally working under the pretext of ‘social responsibility’. Obviously they can’t make enough money otherwise the best possible way to increase the profits is to just charge the customers more.

In other words, IWK will just need to increase their rates, Prasarana and KTM just need to increase their fares. Since customers are a bunch of easily annoyed creatures, the costs were never truly borne by the public (Prasarana for instance have not reviewed fares for more than 10 years).

Realistically, GLCs need to reward staff who are performing really well despite the outcome of the financial accounts otherwise these companies will unable to motivate and retain good workers. They will move elsewhere if their contribution are not recognise.

And as mentioned in the tweets of Prasarana’s CEO, Datuk Shahril Mokhtar (the only CEO so far who took to twitter to briefly explain the AG Report findings) – Prasarana’s financial position is automatically handicapped by depreciation and financial costs amounting to RM700 million annually which greatly contributed to the RM763 million loss. Not surprising since Prasarana is an asset and infrastructure based company.

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No explanation have come forth from IWK, KTM, MIMOS, Jambatan Kedua etc.

The Treasury however, did issue a brief response:

The treasury said these GLCs were not set up for the sake of making huge profits but to fulfill its social responsibility and nation-building objectives.

Hence, it was up to the Ministry of Finance to determine if these companies had achieved its key performance indicators

Why is Khazanah Nasional in San Francisco?

Just a few days ago, we tweeted:

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The answer is found in a newsfeed by Bernama:

Najib opens Khazanah office in San Francisco

SAN FRANCISCO: Datuk Seri Najib Tun Razak officiated Khazanah Nasional Berhad’s regional office for the Amerikas, Khazanah Americas Incorporated (KAI), in San Francisco Sunday.

He hoped that the opening of this office would help propel Malaysia into a developed nation status by the year 2020.

The Prime Minister said Malaysia’s visionary ambitions to reach a developed nation status by 2020 could be achieved by moving up the value chain and creating an economy driven by knowledge, innovation and technology.

Najib said this when officiating the office located at the 45th Floor, 101 California Street, San Francisco, the third Khazanah’s regional office after Beijing and Mumbai.

Also present were his wife, Datin Seri Rosmah Mansor, Communication and Multimedia Minister Datuk Seri Ahmad Shabery Cheek; Second Education Minister Datuk Seri Idris Jusoh; Science, Technology and Innovation Minister Datuk Dr Ewon Ebin; Johor Menteri Besar Datuk Seri Mohamed Khaled Nordin and Director, San Francisco Mayor’s Office of International Trade and Commerce Mark Chandler.

The Khazanah Americas Incorporated office has a scenic view of the Golden Gate Bridge, the world’s longest and tallest suspension bridge when the bridge was completed in 1937, to connect San Francisco with Marin County across the 1,600 metre-wide strait known as the Golden Gate which links the San Francisco Bay with the Pacific Ocean.

Complimenting Khazanah for “the great choice of sparkling office with a nice view”, Najib said Khazanah had made the right choice to be in San Francisco as the city is the centre of innovation in the United States – one of the most dynamic regions in the world, home to the most admired and innovative businesses and institutions.

Najib, who is also Khazanah Nasional Berhad chairman, said the opening of the office has shown that the Malaysian government fully supported and underpinned its seriousness on creating a competitive, sustainable and innovation-friendly environment and encouraged private and government entities to invest in key sectors abroad.

The Prime Minister also said Malaysia was keen to invest in exciting high-value areas such as life sciences, green technology and cutting-edge innovation that could help Malaysia’s transformation efforts.

Najib said Malaysia hoped to learn from the United States its remarkable culture of innovation, risk-taking and entrepreneurship to spur Malaysia’s own economic growth.

He said he was looking forward to see the innovation that would emanate from this regional office initiative.

He said that over the years, Malaysia’s business and economic interests had expanded across the globe and hoped that the Khazanah office would be able to identify potential partners and get the people in innovation in Americas to partner with those in Malaysia.

Najib also said that Iskandar Malaysia in Johor had established itself as a high value innovative centre and its Pinewood Studios, an integrated media production studio facility, are expected to be completed and opened next year.

He said Malaysia had a lot to offer to investors such as big economic growth number of 4-5 per cent a year, its Vision 2020 efforts on track and a low inflation rate of 2 per cent, which was not bad considering the current external factors affecting the world economy.

“With Khazanah Americas, we can further strengthen our presence and build strong networks with businesses here and I hope we can identify potential partners in America to help propel Malaysia into a developed nation status by 2020,” he said.

In his welcoming speech, Khazanah Nasional Berhad Managing Director Tan Sri Azman Mokhtar said the opening of the Khazanah Americas Incorporated office would be a hub for Khazanah into innovation and technology as well as a bridge between the two countries and regions.

Najib, who arrived in San Francisco with his wife early Sunday, is on a working visit here until Sept 24, prior to his visit to New York to lead Malaysia’s delegation to the 68th session of the United Nations General Assembly (UNGA) from Sept 25 to 29.

He is scheduled to deliver a statement at the High Level Meeting UNGA on Nuclear Disarmament on Sept 26, and Malaysia’s statement during the General Debate on Sept 28. – Bernama

And this is an opinion on what Khazanah Nasional is really doing in San Francisco (taken from the Facebook page of Kijangmas Perkasa, who often writes in the blog Demi Negara:

… and the CONmen go marching in.

This time a lavish Khazanah Nasional rep office in one of the most expensive downtown office towers in very expensive San Francisco. Where the in-building parking (if you can find one) charges run at U$3 (RM10) per 15 minutes or US33 (RM110) per day. That would be RM3,300 per month for one car in a dingy basement — the rental rate of a very comfortable KL apartment.

While being fawned head-over-heels by CONmen from Frost & Sullivan and likeminded parasites, PM Najib reportedly complimented the breathtaking view of the Golden Gate Bridge and praised Mr. Non-Performer Royale, Azman Mokhtar for making “the great choice of sparkling office with a nice view.” Yes indeed. A million dollar view that will captivate many a heart. But is Khazanah promoting Malaysia or Northern California?

Who will staff this luxurious office? How many Malaysians? From where and based on what criteria? Another bunch of cocky 26-year olds “selected on merit” who will splash scenes of their wild parties and sinful weekend getaways — this time in exciting SF — on FB? Don’t be surprised if some of the PEMANDU party animals get recycled and sent here to liven up the wild Bay Area LGBT nightlife.

So how much are the rakyat (yes, Malaysian taxpayers) paying these people? Let me guess ………… a lot. Yes, a lot because San Francisco is one of THE most expensive cities in the U.S., with rental rates three times the U.S. average. The median rent for a 1-BR, yes one bedroom apartment in this city is about US$3,300 (almost RM11,000) per month. In preferred neighbourhoods, 1-BR rentals — if you can actually find one — would be US$3,600-4,500. For 2-BRs? You’re staring at US$5,000-8,000 per month. 3-BR? Don’t ask. And we have not even looked at other costs in a city ranked in the top 3 most expensive in the U.S.

How I know all these? I have a SF rep office as well. You pay through your nose in rental, parking and staff costs but as long as you make money, lots of it, its fine.

So will Azman Mokhtar and the merry-men and -women of Khazanah actually “make money” to cover this yet another splurge of the rakyat’s hard earned ringgits?

How?

By bringing in investors? Isn’t that job already done by the likes of Mida, Matrade and Miti? Seriously, what can Khazanah do that Mida and Matrade cannot do or has not already done? Mida has six offices across the U.S. — Los Angeles, San Jose, New York, Boston, Chicago and Houston. Martrade has offices in Los Angeles, Miami and New York. And we have investment minister-counselors in our Washington, D.C. embassy and consulates general in New York and Los Angeles. Throw in Tourism Malaysia and Malaysia Airlines and you’ll have a heck of a lot of “rep offices” offering the same thing again and again to confused Americans.

So what exactly is Khazanah’s role in SF? To attract investments? Again, that’s Mida and Miti’s job. To expand trade? That’s Matrade’s job. To secure tourist dollars? That’s Tourism Malaysia’s job. To play a hand in diplomacy? That’s the foreign office’s job via the embassy and consulates.

Oh, I forgot ….. Khazanah is supposed to SPEND money, NOT make money. While part of the fat budget has been blown on expensive office rental and staff costs, there must be quite a chunk left for a Silicon Valley spending spree. Najib reportedly said in SF, “Malaysia [is] keen to invest in exciting high-value areas such as life sciences, green technology and cutting-edge innovation that could help Malaysia’s transformation efforts.”

Huhh?

What exactly do all those Powerpoint jargons mean?

I’m sure Mr. Kool wannabe here would throw in “value proposition” and “value chain” and “leading edge” and “next-gen” and “ears and eyeballs” and other so-very-90s-lah CON-sultant bullsh*t somewhere in his speech.

As for stopping the spending spree, its too late lah people. The depleting chequebook’s out. Khazanah must be seen to spend on something somewhere to justify their SF office adventure. You see, their No.1 KPI is “to spend money, lots of it” and No.2 KPI is “to lose money, most of it” and No.3 KPI is “blame others, all of them.”

I’m just waiting for some announcement of a “strategic investment” in some “new economy” scam involving solar powered green-coloured multiheaded dildos or something like that run by a couple of Taiwanese H-1B visa abusers out of a Sunnyvale garage repackaged, of course, into some sustainable eco-friendly healthy green technology gizmo that purportedly will yield a financial windfall for Khazanah and propel Malaysia to new heights of economic ecstasy ….. blah, blah, blah. Sounds familiar? A sucker born every minute? Remember InventQjaya? Remember E-Village in the Dengkil boondocks? And don’t let me get into cow farms and such. Just finished a late dinner meeting with some old ex-ministers and the possibility of regurgitating the horrendous raw sturgeon wrapped in salty seaweed and boiled cabbage is very real indeed.

Oh, ….. saw in the newsfeed that Najib had just committed the rakyat’s money into yet another new fund management company, Putra Eco Ventures Inc. The report said: “The company will channel the investments and provide business consultancy services to green technology companies.” Now, that’s a triple whammy of oxymoronia. “Channel the investments”? “Provide business consultancy services”? These types of phrases have scam and leakage and abuse and misadventure written all over them. Throw in “green technology” and you are looking at a financial trainwreck in the making.

So people, another little chapter of the follies of GLC Malaysia unfolds away from the public radar. While the rakyat bicker about twenty sen fuel price hikes and lack of decent affordable housing, the jet-setting chimps-in-suits of Khazanah (… and soon PEMANDU and TalentCorp and 1MDB and other disasters) throw our tax money into bottomless pits in faraway America.

My problem with Najib is that every time he launches or announces or officiates something somewhere, I get an overpowering sense of mindless, needless wastage of the rakyat’s money. And this Khazanah rep office in San Francisco is no different. Again, I just don’t understand the logic. To attract investments, Mida, Martrade and Miti and our embassy and consulates have already done that for umpteen years. No need expensive, lavish office overlooking the Golden Gate Bridge in SF. On the other hand, if you just want to throw money at American companies, to invest in their business schemes or scams, they couldn’t care less about your office. They just want your money, lots of it. Heck, they wouldn’t give a hoot even if you work out of a Motel 6 by the 101 freeway …. as long as you give them money.

So again, what’s this “great choice of sparkling office with a nice view” in San Francisco really about? Is this a necessary strategic move to oversee the deployment of our sovereign funds — our children’s money — in foreign-based ventures crucial to our economic competitiveness, ……. or is this yet another expensive stupid out of control ego trip by some chimps-in-suits condoned by a weak, gullible Prime Minister easily fooled by meaningless CONsultant jargons liberally dished out in slick Powerpoint presentations?

We value second opinion. Please share what you think.

Thank you.

——————————

Blogger Din Turtle wrote his opinion about it here >> http://dinturtle.blogspot.com/2013/09/najib-buka-satu-lagi-pejabat-milik.html?m=1

Malaysia Airlines cuts down its Q1 2013 loss

Now this is a piece of news that might slightly appease former YB Wee Choo Keong. This ardent scrutineer of Malaysia Airlines have been slightly pacified by the fact that the misadvised share-swap between Air Asia and MAS (in substance, it was actually a takeover of MAS by Tony Fernandes and his cronies) had been reversed exactly a year ago.

Today, MAS announced its Quarter One 2013 financial results:

Malaysia Airlines Halves Operating Loss in Q1 2013 with 17% Traffic, 14% Revenue Improvement & Positive Cash Balance

Wednesday, 29 May 2013, Kuala Lumpur – National carrier Malaysia Airlines registered a significant improvement in its operations by reducing operating loss by 46% to RM165 million for the first three months ended 31 March 2013 compared with RM307 million in the same quarter in 2012.

The improved performance was delivered in the face of poor economic conditions in which the airline delivered 17% increase in passenger traffic, 14% increase in revenue, and a higher seat load factor of 76.6%. This performance demonstrates that the continued focus to improve revenue and passenger loads is working. For the first quarter of 2013, the Group increased available seat capacity by 11% and increased flight frequencies by 9%.

Malaysia Airlines registered a RM147 million positive cash balance from its operating activities in the first three months of 2013, compared to a negative cash position of RM202 million in the previous corresponding period. This is the third consecutive quarter of positive cash contribution from operating activities.

“Our operating statistics are strong and recording encouraging traction to build up our passenger numbers and growth. These have enabled our Group to generate positive cash balance, and essentially stop the bleeding. However we still have a lot of work to do to align costs to revenue, to increase productivity and efficiency, and improve yields”, said Ahmad Jauhari Yahya, Malaysia Airlines Group Chief Executive Officer.

“The conclusion of the Rights Issue is a milestone for Malaysia Airlines. With the cash injection and capital restructuring, our balance sheet is now on a very strong footing. This gives us wider options to implement a growth strategy for this challenging business environment”, added Ahmad Jauhari.

Malaysia Airlines’ recent Rights Issue exercise to raise RM3.1 billion from shareholders received an over-subscription of 41% valid acceptance and excess applications for the 13.36 billion new shares on offer. The Rights Issue is part of efforts to ‘reset, reboot and rebuild’ Malaysia Airlines which includes redefining business strategies, rebuilding its balance sheet strength to regain and build up its market position.

Traditionally the first half of the year sees weaker performance for airlines. Coupled with increased pressure on yields from intensifying competition and higher costs, Malaysia Airlines group registered a Net Loss after Tax was RM279 million for the first quarter of 2013 compared to a loss of RM172 million previously. This was mainly attributed to an unrealized forex loss of RM21 million in Q1 2013 compared to a forex gain of RM200 million in the previous year. Higher financing costs for its fleet renewal programme also contributed to the overall net loss.

“The continued high jet fuel prices, added capacity in the market and increased competition, put pressure on our yields. The business environment is tough, but Malaysia Airlines is now able to respond faster to changes in the market”, added Ahmad Jauhari.

Malaysia Airlines group revenue for Q1 2013 rose 14% to RM3.55 billion from RM3.11 billion previously. Expenditure for Q1 2013 was RM3.71 billion, 8% higher than the previous corresponding period, mainly attributed to high jet fuel costs, handling and landing costs, flight-related and leasing expenses. Depreciation also rose with the arrival of 6 A380s, 7 A330s and 8 B738s into its fleet over the last 12 months.

Jet fuel prices remained high at an average USD135 per barrel in the first quarter of 2013 compared to USD130 per barrel in the corresponding period last year. The Group’s fuel bill was 37% of total expenditure.

The Group carried 3.6 million passengers in Q1 2013, an improvement of 16% quarter-on-quarter (q-o-q). For the airline itself, passenger revenue was up 11% to RM2.47 billion, however yield decreased 5% to 24.2 sen per RPK.

Externally, the aviation environment saw strong growth in the first quarter of 2013 with both the International Air Transport Association (IATA) and Association of Asia Pacific Airlines (AAPA) reporting improvements in monthly passenger traffic in tandem with better business conditions.

The Asia Pacific region is expected to be the future growth centre of aviation demand, and Malaysia Airlines is well-positioned to tap this future growth. In addition to strengthening its footprint in Asia Pacific with increased frequencies to more business and leisure regional destinations, Malaysia Airlines now offers a wider international network with its membership of oneworld which it joined on 1 February 2013.

Whilst it is still early days to quantify the benefits, the carrier saw interline revenue jump 40% in the period February to March. “We expect interline revenue to increase further as more guests get to know about Malaysia Airlines through oneworld. Joining the alliance is a good platform to widen our reach and brand”, added Ahmad Jauhari.

In other operational matters, On Time Performance (OTP) was maintained at 85.1% for the first quarter of 2013.

Its fleet renewal programme is on-going. By end March 2013, all 6 A380s ordered had been delivered. By flying twice daily Kuala Lumpur-London, and once daily Kuala Lumpur-Paris and Kuala Lumpur-Hong Kong, Malaysia Airlines is optimizing aircraft utilization to average 17 hours daily. This is the said to be the highest, if not one of the highest in the world, A380 aircraft utilization.

It is quite a relief to see our national carrier is showing signs of improvement. Although they are not out of the woods yet, the exponential increase in revenue sees greater hope in cutting down their net loss after tax for the whole 2013. In 2012, they suffered RM433 million in losses while back in 2011, the loss was even higher at RM2.52 billion.

But what is troubling is the non-operating expenditure MAS is incurring such as depreciation, forex losses and financing costs. Stating the obvious, if these items are not managed and streamlined properly, it will eat up the revenue gained in each and every quarter. The only silver lining is the positive cash balance. And even that was helped by the rights issue.

However, this is much better than all the ‘turnaround exercises’ done by previous managements of MAS to window dress its financial statements. Asset unbundling, asset flipping, forex gains, fuel hedge initiative and all other short cuts conjured by the consultants etc.

What MAS needs is a more organic growth. And hopefully its top management can perform their duties that we all can be proud of.

By the way, kudos to MAS for bringing back a stranded mother and her sick child from Vietnam last week. Now that is a humane effort that will be remembered for a long time.

In other news, Felda Global Ventures Holdings Berhad posted a remarkable revenue in Q1 2013.

KUALA LUMPUR: Felda Global Ventures Holdings Berhad (FGV), the world’s third largest oil palm plantation operator, posted a 55.9 per cent increase in revenue to RM2.68 billion for its first quarter ended March 31, 2013.

But its profit before zakat and taxation for the quarter declined by 22.2 per cent to RM218.51 million, from RM280.81 million in the corresponding quarter last year.

Net profit dropped by 25.2 per cent to RM167.06 million from RM223.21 million in the same period previously, FGV said in a statement Wednesday.

The company said the decline in profit primarily reflected the effects of lower average crude palm oil (CPO) price realised by the group of RM2,264 per tonne compared with RM3,205 per tonne in 2012.

Malaysian CPO prices have been trading at around RM2,315 per tonne since December 2012 compared with last year’s average of RM3,190 per tonne, which was aggravated by reduced palm products purchases as well as high inventory holdings in the edible oil consuming countries such as India and China, it added.

FGV Group President Datuk Sabri Ahmad said that in line with other plantation companies, FGV’s plantation division had also been adversely impacted.

“However, as an integrated organisation, FGV has the flexibility to utilise cheaper feedstock in the refineries to offset the effect of reduced pricing and at the same time compete with other edible oil producers,” he said.

He added that the palm oil industry was expecting a price correction by the middle of the year, especially during the upcoming fasting month as demand rises.

Sabri said the decline in profit was also attributed to other factors, including higher fair value changes in the land lease agreement liability of RM54.60 million and provision for impairment which amounted to RM13.66 million related to a joint controlled entity.

Sabri said that the government’s decision to launch the B10 biodiesel programme in its effort to stabilise the CPO price was also timely.

“Taking on this opportunity, FGV had entered into an agreement to acquire a biodiesel refinery located in Kuantan, Pahang and expects the plant to be fully operational by mid-2013,” he added.

“With our resilient integrated business model and new businesses developed in the recent years as well as strong asset base, we are reasonably confident that we will overcome the difficult environment, and barring any unforeseen circumstances, we are optimistic of the prospects for the rest of the year,” added Sabri.

There’s nothing much that can be said about FGVH since that industry is at the mercy of global prices. Even Genting Plantations is suffering a dip of their quarterly profits.

PETALING JAYA: Genting Plantations Bhd’s net profit for the first quarter 2013 (1Q13) fell 44% to RM44mil from RM78.7mil a year ago, due to lower palm product selling prices and a RM31mil contribution for charity purposes.

However, its revenue for the quarter has increased 26% to RM343mil from RM272.6mil a year ago, notably due to stronger sales in its property segment. Earnings per share were lower at 5.8 sen versus 10.38 sen a year ago.

“In 1Q13, the group achieved average crude palm oil and palm kernel selling prices of RM2,293mt and RM1,165mt, down 28% and 40% respectively from the corresponding period of 2012,” it said.

Genting said its softer palm product selling prices outweighed the impact of higher crop yields during the quarter, adding that its fresh fruit bunches output had increased 32% year-on-year (yoy) mainly from its Sabah estates, which had recovered from favourable weather and additional planted areas are moving into higher yielding brackets.

On the other note, the firm noted its property division earnings had quadrupled, posting an increase of profit to RM25mil from RM5.9mil a year ago backed by strong demand for properties in Genting Indahpura.

Genting said it would continue to leverage its presence in Johor, particularly in the burgeoning Iskandar Malaysia region.

Felda moved to financially punish lying politicians

There is something very telling about the legal suit by Felda today:

Felda sues ANAK president and 6 others for defamation

KUALA LUMPUR — The Federal Land Development Authority (Felda) today filed a defamation suit against Felda Settlers’ Children Association (Anak) president Mazlan Aliman, PAS secretary-general Datuk Mustafa Ali and five others over allegations that Felda sold its palm oil to Israel.

The writ of summons was filed through Mssrs Hafarizam Wan & Aisha Mubarak at the High Court Registrar’s Office here.

Felda named Mazlan and Mustafa as the first and second defendant, while Harakah editor-in-chief Ahmad Lutfi Othman, editor Taufek Yahya, writer Mohd Arif Atan and publisher Angkatan Edaran Ent Sdn Bhd, as well as Parti Keadilan Rakyat (PKR) secretary-general Datuk Saifuddin Nasution Ismail, as the third to seventh defendants.

According to the statement of claim, Felda claimed that Mazlan had uploaded a defamatory statement on his Facebook page on Nov 19 last year and had also made defamatory statement during a gathering in front of Felda office four days later (Nov 23).

Felda claimed that the statement was republished by the second to sixth defendants through several articles in Harakah newspaper between Nov 26 and 29 last year.

Felda also claimed that the statement had affected Felda’s reputation and that all defendants had done so with the intention to achieve their personal agendas to destroy people’s faith in Felda.

The plaintiff is seeking general and exemplary damages, cost as well as other relief deemed fit by the court.

Felda is also applying to the court for an injunction to stop Mazlan and his agents from talking about or publishing the defamatory statement in the Internet and print media.

The plaintiff is also demanding a written apology from Mazlan in local newspapers and magazines.

Meanwhile, Felda’s lawyer Wan Azmir Wan Majib told reporters that they would send the writ of summons to all defendants within this week. -BERNAMA-

This suit came about two weeks after Felda had sent them a notice of claim for the lies and misinformation they spread to public, as news on 13th December 2012 below had shown:

Felda serves notice of claim to Mazlan and opposition publications

KUALA LUMPUR – Felda has sent a notice of claim to Mazlan Aliman, Harakah and Suara Keadilan newspapers over Mazlan’s accusation that the conglomerate is selling its palm oil produce to Israel and the statement was reported in both publications.

The statement was also published on Mazlan’s Facebook account.

Mazlan, in his statement, accused Felda of selling its palm oil produce to Israel.

Felda in an official statement has denied the allegations made by Mazlan.

“These allegations are not true and are malicious in nature, in fact it has tarnished Felda’s image as an international conglomerate,” it said.

Due to this, Felda has decided to take action against Mazlan and the two newspapers via Messrs Hafarizam Wan & Aisha Mubarak.

The notice of claim has been sent by Felda’s lawyers to Mazlan, Suara Keadilan and Harakah on Dec 10 and 11.

The same legal notice has been given to Harakah, naming its writer, news editor and chief news editor, publisher and printer as defendants involved in the libellous article on Felda.

Meanwhile, Parti Keadilan Rakyat which is responsible for publishing the Suara Keadilan newspaper has also been served with a notice.

Felda has given the defendants 14 days to apologise and retract the statement that has been made and published.

The defendants are also expected to offer to compensate Felda for the damages they have caused, failing which, Felda’s lawyers will proceed with the legal suit after the 14 days.

Obviously, Mazlan Aliman and his ilk in Pakatan Rakyat did not have the proof to back their allegations hence the lawyers in Felda moved to sue them. Otherwise, the matter would have not been pursued by Felda at all. The question now is, will Pakatan politicians who are prone to lying, will learn their lesson and stick to facts when conveying their political agenda?

I doubt it.

After recent political events had really, really exposed Pakatan Rakyat’s politicians to be corrupt and dirty, we could only extrapolate that if they gain powers as Federal government, the magnitude of corruption they immerse themselves in would be bigger than we could imagine.

Let’s see what happens next.

Tussle between two MAS unions

A reader sent this through the comment section:

______________________________________

PRESS RELEASE
Urgent 28th December 2012

Protest Against Secret Ballot Exercise On MAS Cabin Crew & Claim of Recognition By National Union of Flight Attendants Malaysia (NUFAM)

MASEU has been informed or given to understand that NUFAM has been registered and had sought recognition from Malaysia Airlines (MAS) to represent its cabin crew.

MASEU is of the view that it is highly improper or right for recognition to be given by Malaysian Airlines to entertain NUFAM’s claim for recognition due to the following reasons:-

(1) A “general recognition” had long been accorded by MAS to MASEU as a general body to represent its non-executive employees including its cabin crew (i.e. graded staff) since the establishment of MASEU as an in-house union in 1979, after the Airlines Employees’ Union, Peninsular Malaya (AEU), (which represented most of Malaysia Airlines’ employees including those of foreign airlines that operated to Peninsular Malaysia) was deregistered.

(2) Giving recognition to two unions to represent the crew is not in the spirit of good industrial relations and would cause industrial disharmony among the cabin crew who are members of MASEU and members of NUFAM. This will conflict with the objective of the Industrial Relations Act 1967.

(3) MASEU cabin crew are well represented for 33 years in its central Committee since 1979 and currently is represented by four duly elected Cabin Crew. MASEU had successfully concluded Collective Agreement (CA) covering all its graded employees including cabin crew from the time of its establishment including the 2012 CA which MASEU had concluded with MAS on 12.12.2012.

After almost one year, we are puzzled to receive a circular via MH internal mail dated 20th December 2012 from Secretary General of NUFAM to MAS Cabin Crew that NUFAM and MAS have signed a Voting Memorandum of Understanding (MOU) which will allow the National Union of Flight Attendant (i.e. NUFAM) to conduct a secret ballot exercise in MAS and this secret ballot exercise will determine whether NUFAM will be allowed to manage MAS Cabin Crew’s CA.

MASEU protest to the proposed secret ballot exercise and MASEU request that the following action be taken by the Industrial Relations Department:-

a) To permit MAS not to entertain any claim of recognition by NUFAM to representatives cabin crew members on the grounds given above and it is improper for MAS to sign a Voting MOU with NUFAM on 19th December 2012 especially when there is already an existing in-house union i.e. MASEU that governs MAS Cabin Crew’s CA successful for 33 years,

b) To seek the good office of Director General of Trade Union / Minister of Human Resources to direct the NUFAM to amend its constitution to prohibit MAS cabin crew to join NUFAM on the ground that there is IN EXISTENCE an in-house trade union to represent MAS cabin crew, as evident from the Collective Agreements concluded with MAS SINCE 1979 and WHICH had been taken cognizance by the Industrial Court,

c) To advise the Director General of Trade Union to withdraw or cancel the certificate OF registration of NUFAM, under Section 15 (2)(a) of the Trade Unions Act 1959 (Act 262) as MASEU has the largest number of MAS employees as members of MASEU if NUFAM refuses to amend its constitution,

d) To cancel the proposed secret ballot exercise involving MAS Cabin Crew, as by allowing this exercise, would cause a conflict of interests or division of loyalty among MAS Cabin Crew, who are members of MASEU if they are invited to participate in the secret ballot.

e) To advise MAS to revoke the Voting MOU where MAS and NUFAM signed on 19th December 2012 as this contravenes Article 8 of the Collective Agreement (CA) between MAS and MASEU. An extract of Article 8 is reproduced below:-

“Article 8 – UNION RECOGNITION AND SCOPE OF REPRESENTATION

The company recognized the Union as the sole collective negotiating body representing its permanent employees in Peninsular Malaysia referred to in the Employees Classification Table set out in Schedule IV.”

MASEU views this matter seriously as the action of MAS management in signing the Voting MOU is tantamount to inducing MASEU Cabin Crew to refrain or resign to be a member of MASEU and this contravenes Section 5.1. (e) of the Industrial Relations Act 1967 which is reproduced below:-

“SECTION 5 – PROHIBITION ON EMPLOYERS AND THEIR TRADE UNIONS IN RESPECT OF CERTAIN ACTS

5.1. No employer or trade union of employers, and no person acting on behalf of an employer or such trade union shall:-

(e) Induce a person to refrain from becoming or to cease to be a member or officer of a trade union by conferring or offering to confer any advantage on or by procuring or offering to procure any advantage for any person.”

MASEU believe that since the registration of NUFAM was under political pressure, we also believe that the secret ballot exercise is subsequently under political pressure to grant recognition to NUFAM to represent MAS Cabin Crew is an attempt to annihilate sustainability/survival of MASEU. This practice is highly undesirable and bad for fostering good industrial relations.

MASEU object strongly to the stand of the Ministry action and demand the Ministry to act rightly within the legal framework of the Industrial Relations Act 1967 and the Trade Union Act to foster good industrial relations in not only MAS but in the Country.

MASEU further believe if such practice is condoned or continued, it would encourage other categories of MAS graded employees to form another National Union in MAS, which would not be in the interest of MAS and its employees.

MASEU request that DG industrial Relations and DG Trade Union to take immediate action to accede to our request.

_________________

The reader further said, - MAS does not want to recognise NUFAM but was forced by DEP MOHR to bear all costs for NUFAM exercising secret ballots inside MAS so NUFAM can recruit MAS cabin crew as members. Current number NUFAM has is 58 only since the inception of nUFAM on 27th January 2012. Dep MOHR is the one responsible for approving NUFAM even though in-house union already existed for mas cabin crew. REPORTS to SPRM on NUFAM President for misused of fund already been lodged.

Why should there be two unions within one company? This matter was also highlighted by The Star here.

Proton and its hybrid misadventures

Back in February 2012, I wrote about the generous funds being given to Proton for the past few years in order for it to develop a national hybrid car.

Bringing up to the speed on the little facts that we have gathered so far from the previous article I wrote:

a) In 2010, Proton obtained a RM270 million grant to develop hybrid cars

b) Mass production of hybrid cars are scheduled to commence in 2012.

c) 30 hybrid cars were to be delivered by end 2011 and even this promise was hardly kept.

d) Proton has cash balance of RM1.2 billion in March 2011.

e) Consequent press statements revealed that 200 hybrid cars were scheduled to be delivered only in 2013.

f) Proton is in a joint venture with Fraser – Nash Research Ltd (FNR) to develop this technology and it seems that FNR were fully paid upfront without any regards for its deliverables.

I asked 4 questions pertaining this matter:

1) What is the status of these hybrid cars which are currently being used by the government officials? The Energy, Green Technology and Water Ministry or Proton needs to state the road worthiness of the cars. Are all those 30 units doing perfectly well? This is important since RM270 million of government’s money were given to Proton to develop it.

2) Since RM270 million was a grant and not a soft loan, the cost of each car (at R & D stage) is roughly about RM9 million. Slightly more expensive than a Bentley Continental. Is this justified?

3) Proton has cash balance of RM1.2 billion as at March 2011. Why would it need a further GRANT from the government of RM270 million? Surely RM270 million can be used elsewhere other than the cash rich Proton.

4) How much of this RM270 million being paid to third party such as Fraser – Nash and others?

 This is the latest news as of yesterday:

Proton electric car coming in 2014, Parliament told

Proton will be selling electric vehicles by 2014, International Trade and Industry Minister Datuk Seri Mustapa Mohamed told Parliament yesterday. The national car company is currently collaborating with UK-based Frazer-Nash Research to develop its own EV.

In a reply to Gombak MP Azmin Ali, the MITI minister said that Proton had allocated RM500 million for research and development in green technology and is expected to gain profits after commercialising EVs in 2014, The Star reported.

The PKR man asked MITI to state the rationale of investment by Proton through Frazer-Nash, to which Mustapa replied that Proton’s R&D spend is much smaller than other car manufacturers.

It was pointed out that GM invested about US$1.2 billion to develop its Chevrolet Volt while Nissan-Renault has allocated US$5.6 billion for the same purpose. Allegations that Proton spent some RM270 million to test 30 cars and each cost about RM9 million were untrue, Mustapa said.

Meanwhile, Bernama reports that the government is ready to allocate RM120 million next year to Proton for the development of an EV before it can be commercialised mid-2014.

The government allocated RM100 million this year for Proton to develop a hybrid and electric model and will consider an allocation of RM120 million next year for research and development. All this depends on Budget 2013 which will be tabled by the Prime Minister tomorrow (today) and on Proton meeting its key performance index target,” Datuk Seri Mustapa Mohamed said.

So, apart from RM120 million they will provide next year, Proton had already been given RM100 in 2012. This is on top of the RM270 million grant given in 2010. This is a total of  RM490 million of grants given to Proton in the span of 4 years in order to mass produce hybrid cars in 2014.

The deadline had been pushed further and further as the years goes by. Basically a two year plan has now been stretched to 4 years with unsuccessful piecemeal products being manufactured during the period.

Word has it that those 30 pilot cars were not up to standard and are no longer running due to breakdowns. In other words, they are not road worthy. Proton and FNR failed in  their job and yet we reward them with more money.

After the takeover of Proton from Khazanah Nasional last May, Proton is now under the ownership of DRB Hicom. Why would the government pump more money to a privately owned company where the ultimate owner is already cash rich and could definitely stand on its own two feet?

The purpose of Proton shares being sold was to limit its dependence from the government. And yet, Proton is still being treated with silver spoon eventhough it is no longer the direct responsibility of the government.

Dato’ Lukman Ibrahim, the current boss of Proton has so much to answer for this slush of funds coming in.

Is there no key monitoring process being done within the Proton management whereby a hybrid cars R & D of this magnitude has been deemed a failure and yet, they still continue with this venture regardless?

The Proton management will be held accountable for this lack of willpower to call a spade a spade and make the hard choice of terminating any joint venture with a 3rd party research company which could not deliver.

The RM120 million allocated to them in the national budget should have been allocated somewhere else which could be more useful to the rest of the people instead of being invested in a wild goose chase where the cost has begun to outweigh its benefit.

4 years and RM490 million down the road with only 30 lousy cars to show for is definitely a joke.

Crows flocking together? – (Balfour, Halcrow, PKR)

Yesterday, we explored the possibility that Rafizi Ramli and Anwar Ibrahim had vested interests in seeing Balfour Beatty – Ingress consortium wins the Ampang LRT extension project.

In one of the paragraphs, it was mentioned that Halcrow was selected to be an independent evaluator of the tender bids eventhough it was shown in records that it had business ties with one of the bidders – Balfour Beatty.

The news in The Star today didn’t come as a surprise. It is self explanatory. One thing for sure, those who leaked the documents could face the law. As for Rafizi, he could have used the Whistleblower Protection Act and save himself from the trouble if all his allegations and exposure were proven to be untrue.

But instead, he chose to do the usual chest thumping, attention seeking, react first – think later kind of drama in order to gain political mileage. Every action has consequences. Unless of course, he and Anwar Ibrahim think they are above the laws. The public would thank them more if they are more sincere and guilt-free in exposing wrongdoings. We have no doubt that there are corruption in this country. But please don’t think everyone is involved in corruption just because you yourselves are doing it too.

Halcrow under probe

MACC checks for any conflict of interest, integrity of evaluation on bids

PETALING JAYA: British engineering company Halcrow is under investigation by the Malaysian Anti-Corruption Commission (MACC) for a potential conflict of interest and on the integrity of the evaluation process of eight bidders for the RM965mil Ampang light rail transit (LRT) job.

Halcrow, which was appointed independent evaluator of the eight bidders for the LRT job, was tasked with assessing the capabilities of the bidders which included a joint venture consortium led by George Kent (M) Bhd and other tenders by joint-venture companies involving companies such as Balfour Beatty.

The police have also started separate investigations into how classified documents were leaked, which has since been used to create a political storm over the award of the contract to the eventually winner of the tender the George Kent-Lion Pacific joint venture.

“The relevant authorities are investigating the matter,” said Syarikat Prasarana Negara Bhd group managing director Datuk Shahril Mokhtar.

Sources said the MACC and the police had interviewed officials in Prasarana on those two separate allegations, the first surrounding Halcrow in its role as an independent evaluator.

MACC director of investigations Datuk Mustafa Ali confirmed the commission was looking into the matter but declined to elaborate.

Halcrow, which was to assess the capabilities of the bidders on behalf of Prasarana, undertook a technical evaluation of all the companies involved in the tenders, including one by the Invensys-Balfour Beatty Rail-Ingress consortium.

The British-based company that provides major consultancy services for infrastructure developments was to have independently evaluated the bid submissions for the Ampang LRT extension and report its findings, had a prior working relationship with Balfour Beatty in a past tender.

A search of both companies revealed that directors and top officials of both Halcrow and Balfour Beatty had positions in joint-venture companies established by both companies to bid for the Hounslow Highways PFI contract in the UK. It did not win that bid.

Balfour Beatty and Halcrow were part of a consortium that won a £35mil (RM169mil) Porthmadog, Tremadog and Minffordd bypass in Wales.

Both companies had also formed a joint-venture company for a project in the Jebel Ali Free Trade Zone.

The relationship between both Halcrow and Balfour Beatty might have given rise to questions whether proper disclosure was made of their relationship prior to the appointment of Halcrow to independently assess the companies bidding for the project.

The scorecard of the companies bidding for the project has since been politicised by PKR’s director of strategy Rafizi Ramli. On July 3, he disclosed details of the Halcrow technical report which was critical of George Kent and questioned the award of the Ampang LRT project to George Kent.

The police are probing how the documents were leaked under the Official Secrets Act and have interviewed Prasarana officials on that matter.

Prasarana has since commented that the leaked details of the Halcrow report did not give the public a full picture of the entire tender and award process.

“Dated selective excerpts have been superseded by new information resulting from the clarifications. They did not do justice by labelling certain activities as interference’ when what were and are being done are due diligence processes by the Government,” Prasarana media manager Azhar Ghazali said in his comment on July 20.

The George Kent-Lion Pacific consortium has refuted allegations it was incapable of delivering on the Ampang LRT extension project.

“We strongly refute the baseless allegations that GKLP-JV (George Kent-Lion Pacific joint venture) failed the full technical and commercial evaluations. There were numerous criteria considered by consultants, the Finance Ministry and by Prasarana,” said George Kent executive director Dr Cheong Thiam Fook in a statement on Aug 2. George Kent is confident it would deliver the system works for the Ampang LRT extension on cost and on time.

Anwar Ibrahim’s LRT project

We heard so much news about the failed bid of Balfour Beatty consortium for the past few weeks.

Parti Keadilan Rakyat had not been shy in organising weekly press conferences to disseminate information to the ignorant public about the alleged abuses of power and corruption that are plaguing our country. All these apparently are committed and perpetuated by the Umno (not Barisan Nasional) government.

PKR’s ever loyal lackey, Rafizi Ramli has been given the unenviable task of exposing all these alleged corruption which almost always would land him in hot soup. This is due to the fact that all his exposures were either done unethically or the facts he presented were flimsy at best and filled with conjectures or with extrapolation of assumptions.

The latest episode is about the Ampang line LRT extension project which was according to PKR, was initially won by Balfour Beatty consortium. It was reported in his 13th July press conference that Balfour Beatty is the best contractor for this job.

Rafizi has repeatedly accused the prime minister of interfering in the tender bid and granting the multimillion contract to George Kent, which had scored one of the lowest points in the technical and commercial evaluation for the project, but has not shown proof until this week.

This was despite an earlier decision by Putrajaya to award the multi-million ringgit rail project to Balfour Beatty-Invensys Consortium, which Rafizi said was best qualified for the job.

He implies that there is something wrong with the tender process and accused the Prime Minister as intervening the selection process. His main contention was how could George Kent be given the contract and not Balfour although the latter apparently scored higher than the former in the tender evaluation process.

He is astonished that contractors recommended by Syarikat Prasarana were not selected by the Ministry of Finance’s Tender Committee. Furthermore, Rafizi assumed that the selection of contractors can be done at the whims of MOF. This had riled him up and PKR as a political party is not happy with it, to the point of making this an election issue.

Hence they are making so much noise due to the fact that a contractor had lost the contract to a rival company.

But it is equally astonishing that Rafizi and PKR did not even utter a word of protest when in one of the initial rounds of the tender process, Balfour Beatty was rumoured to receive this contract eventhough a South Korean consortium (PDA Consortium) were highly recommended by Prasarana.

An average observer can note that Rafizi had been silent about this issue a few months ago. Especially when his favourite contractor seemingly got the contract. But that changed a few months later.

His first press conference came in late June 2012 when, like a jilted lover, lambasted Prime Minister for snatching the contract right under Balfour’s nose and giving it to George Kent consortium.

Now lets review the point of contention from Rafizi on why George Kent shouldn’t get this contract. He claimed that George Kent had scored one of the lowest points in the technical evaluation process (although initially he said George Kent failed the process). He also claimed that George Kent’s bid were higher than Balfour’s.

We would like to believe he is honest and selfless

Thirdly and this is quite tedious, superficial and superfluous; George Kent has a partner which had made business transactions with one of the business partners in a Scorpene deal more than 10 years ago. A professional consultant that advises the tender process, Halcrow even said that “it is not confident that the George Kent consortium can carry out the project”.

In actual fact, George Kent – Lionpac is one of the 28 companies that submitted their tender documents and pre-qualified for the job. Balfour Beatty – Ingress consortium is another company that had a chance to win this job.

Notwithstanding the points received by the Korean PDA consortium, George Kent received 38.62 out of 70 points on technical. All participants of the tender must meet the passing mark of at least 35 to qualify for the next stage. Notably, Balfour Beatty scored higher. And at this point of time, Geroge Kent was third lowest bidder out of 8 shortlisted.

Ostensibly, George Kent failed the financial aspect (scoring 8.7 out of 30 points) but this was due to late submission of evidences on their financial strength and position. When their cash and funding position was finally evaluated by MOF, George Kent eventually scored higher financially and passed in that aspect. This fact was neglected by Rafizi and PKR and was not included in any of their press conferences.

Therefore, it is unfair to say that George Kent do not deserve this project. In fact, when the project was awarded, George Kent made statements to rebut all the allegations that it is not worthy of such project. In the end, the cost of the project given is even similar to what Balfour was rumoured to bid; at RM956 million.

We all know, and this can be the same in all states, Pakatan or otherwise, that the winner of a tender process is not necessarily the ones that received the highest mark or bidding with the lowest cost.

It is also a moot point to delve into the role of Halcrow in the tender process although it is quite strange to see that the role of giving independent advice on the tender process went to a company which had a lot of business ties with Balfour Beatty. Maybe Halcrow had declared this beforehand and the MOF sees nothing wrong with it. Moot point.

Please note that Prasarana is 100% owned by the MOF and it is only logical that all strategic decisions are made by the shareholder. And selection of contractors fall within the ambit of shareholder’s powers.

Now, what is it about Balfour Beatty which made them receive an utmost support by PKR? The answers could lie in Balfour’s main partner in this consortium – Ingress Corp Bhd.

Ingress’ chairman and chief executive officer is none other than Datuk Rameli Musa. He was Anwar Ibrahim’s schoolmate back in the MCKK days. He is so close to Anwar Ibrahim, he got a grand exoneration and support from the former deputy prime minister against the accusations thrown by Raja Petra back in 2008.

Moreover, Rameli Musa is a fellow trustee in a foundation headed by Anwar Ibrahim. Who knows what other connections he might have. Back during the dizzying heights of Anwar Ibrahim as Deputy Prime Minster, Rameli Musa was vice chairman of Sapura and is reported to be a ‘confidant’ of this glorified heir apparent of Dr Mahathir.

“We lost that contract by only this much”

Obviously with all these connections and the fact that the whole of PKR, with Rafizi as the spokesperson of Anwar Ibrahim are busy defending Balfour and wrongly excoriating Najib just because another company was awarded the project, the coincidence of Ingress – Balfour – PKR cannot be denied. Arguably, Anwar Ibrahim’s LRT project could have been key to fund Pakatan Rakyat’s war chest.

We truly want to believe that Rafizi and PKR are being selfless in trying to expose any wrongdoings by the federal government for the sake of the people. We do want to see that Rafizi could at least present a truthful and honest facts devoid of any ulterior political motives. At the very least we would love to see Rafizi win a debate convincingly.

This remains to be seen.

More dysfunctional stories about MAS unearthed

We all know that the criticisms levelled at Malaysia Airlines are nothing short of unpleasant and sometimes can be vicious. But this stemmed from the now cancelled share swap with MAS’ competitor Air Asia. One thing we can be sure, the need to criticise MAS is to see that it will regain its footing amongst the elites in the commercial flights industry.

There was no need to incur serious money to change the logo when the logo itself is the least of its problems

One industrial expert told yours truly, how could MAS, winner of several best cabin crew awards and other notable achievements for several years could suffer a loss while Air Asia, a young airline with such dodgy reputation of having guaranteed flight delays and poor cabin experience and even worse public relations records could garner profits.

The critical key is MAS’ operational costs.

It was never about its reputation or staff performance.

Buried deep in YB Wee Choo Keong’s more recent post, a commentator by the name GE Man wrote a list of peculiarities that is currently being faced by MAS. One have to wonder if they are all true. If they are, then the challenge MAS ought to face is much more steep than the government realised.

Thanks to the blog MAS Troubleshooters for pointing out the said comments:

After the proper set up of MAS Engineering 20 years ago, never in our history we send our aircraft for maintenance to 3rd party .

Yet this Monday/ 23rd July , MAS subsidiary airline Fire Fly is sending their turbo prop ATR 75-200 aircraft to SAE (Sepang Aircraft Engineering) to do a maintenance C1 checks.

One of the aircraft to be send is with registration 9M-FYH.

AJ and Azhari should tell us why MAS Engineering lost this contract too.

Bet they will say that MAS Engineering /MAE had no hangar space and man power to do it .

AA Engineering office is in SAE hangar too, what a coincidence !!

Some one will start to tell all MAS Engineering staffs that we don’t have much work in MAS engineering thus we got to reduce staff and offer VSS.

Lately too, not much of third party aircraft maintenance contract secured in MAS Engineering.

Good luck to all MAS Engineering staff , hope tomorrow you will still have your job.

After loosing Fire Fly ATR 75 maintenance contract to SAE , MAS Engineering /MAE lost another contract to AIROD for Batavia Air and Lion Air B737-300/400 maintenance .

The list of conspiracy and sabotages that bleed’s MAS to death:

1) Killing off Fire Fly B737-400/800 Jet Services since it is directly competing with AA as a low cost community carrier and taking over some of its routes.

2) Cut/Stop MAS profitable routes (Bandung , Surabaya , Sydney etc etc) so AA can take over the routes and mount additional flight. The rakyat had no choice but to pay what ever price AA put since they are monopolizing this routes.

3) Re schedule / re timed MAS flight to odd hours (Hong Kong, Beijing etc etc) so that AA take the prime slot. MAS seat’s load factors dived.

4) Signed the so called an AAX’s 35,000 passengers re-accommodation at a very low fare. MAS loosing money at least MYR 1000 per AAX’s passengers carried and lost of sale able seats to would be full paying MAS passengers.

5) Logo and re-branding, con-sultan fee’s paid, re-painting of more then 115 aircraft which will cost at least MYR 900,000.00 per aircraft that requires down time of at least 10 days.

It will cost a whooping MYR 100 millions. Lost of aircraft utilization will cost money too to MAS. Luckily the change of logo and re-branding were restricted to A380. Even that will cost money for the respraying of the 6 A380!

6) QPR sponsor worth MYR 10 million when AJ is crying MAS is bleeding.

7) A380 seat re-configuration at the wimp and fancy of the Pariah which cost MAS at least MYR 4 million per ship set. With 6 unit A380 ordered , this will add an additional cost of MYR 24 million to MAS and the “old seats” to be scrap.

8) The A380 ferry (joy rides) flight from Toulouse to Kuala Lumpur with some joy riders on board who are not related at all to the ferry flight formalities, incurring additional cost of sending them to Toulouse, hotels, daily allowances and lost of sale-able commercial seats, Kuala Lumpur – London and Kuala Lumpur – Paris.

9) Lost of UN UNIFIL Lebanon lucrative charter flight to AAX. Giving an excuse of MAS don’t have any aircraft available to do it where’s else many aircraft laying idle due to routes cut and excess cabin crews had to be deployed to Golden Lounge to work.

10) Lost of Fire Fly ATR 75-200 maintenance contract to SAE.

11) Lost of Batavia Air and Lion Air B737-300/400 maintenance contract to AIROD.

12) The would be B777 seat and IFE retrofit worth at least MYR 150 million for all 15 unit MAS B777. This B777 will be phased out in 3 years time yet a retrofit is initiated and as it is the seat and IFE served its purpose well.

13) B737-800 steel brakes changes to carbon brakes which cost millions. AJ had issued a direct LOI/LA to one of carbon brakes manufacturer without going thru’ a normal company procurement procedure and WITHOUT Board approvals!!

Using a carbon brakes is only economical if you use it since day one you buy the aircraft. Now MAS got to buy the new carbon brakes and discard/throw away/scrap the steel brakes inventory worth millions and MAS got to change tyre type from radial to bias tyre!!

14) Two weeks ago in London Farnborough airshow, AJ signed a MYR 5 billion contract for A380 Trent 900 Engine Total Care Maintenance Program with RR for as long as MAS is flying this A380 aircraft. No engineering and financial evaluation was carried out and NO BOARD approval sought. All decide by the TRIO, AJ, Azhari and Amin.

15) Approximately 3 years ago MAS/PMB had sold 17 unit of their B737-400 classic aircraft to AAR and MAS leased it back (Sale and Leased Back ) from AAR until such time that all MAS new B737-800NG is delivered as replacement.

Two weeks ago, during Farnborough Air show in London too, MAS Airlines Engineering Group (AEG) and someone had signed an agreement with AAR to purchase back 6 unit of this B737-400 classics.

The surprising deal is that the purchase price per aircraft is MYR 19.8 million (USD 6.4 mil). The market price is only USD 2.5 million (MYR 7.75 mill) each (Please refer http://www.speednews.com for aircraft prices).

MAS is paying 2.5 times more then the market price!!!

AND what is the logical explanation buying back this junk??

MAS will be milked by a whooping MYR 118.8 millions for this deal.

As usual no engineering and financial evaluation was carried out and NO BOARD approval sought. All decide only by two persons and one of whom is an ex GE Man.

16) Early this month (July), against all MAS procurement procedure and the first one in MAS history, Azhari had issued an LOI (Letter Of Intent) to LHT a contract worth MYR 500 million for the A330 Aircraft Component Support PBTH (Power By The Hour), knowing that there is other bidders who had offered a lower price then LHT .

Azhari is the first CEO of MAE (MAS Aerospace Engineering) history who issue LOI without Board Approval.

He doesn’t have such authority, only tender department who can issue LOI/LA after BOD had approved it.

A wrong procurement procedure, Azhari will bull doze this A330 LHT contract during this coming BTC (Board Tender Meeting) on Wednesday / 25 July 2012. He will try to shove it to the BOD throat.

17) In the making, Azhari and Amin is now trying to do something about the B737-400 engine CFM56-7 PBTH (Power By The Hour) contract worth at least MYR 1.5 billion (minimum 10 years contract)( more then 200 engines) and source said it may be a direct nego again. One can expect where it will go. Just think who is maker!

18) In the making think, Azhari and Amin is trying to figure out who will get the B737-800 / B777 / A380 / B747-400 APU maintenance contract worth more then a 1 billion ringgit . A total of more then 150 units of APU (Auxillary Power Unit) is to be contract out for maintenance soon.

With 18 on the list above, my dear PM and BOD of MAS and Tan Sri chairman, YB YB , you must not stand still while MAS being screwed to death. MAS is BLEEDING ok!

This will be the way to kill MAS as MAS be will be liable and inherit a long term high engineering operating cost, too high to sustain the business for at least the next 10-20 next years from now , how MAS will survive like this ?

A procurement manual is there to be followed so the tender and bidding is carried out in a transparent manner, how come one person or a TRIO are allowed to decide on this multi billion ringgit contract.

At least least 3 bidders must participate to make the bidding process to be an advantage to MAS bottom line. Direct nego is a suicide!!

The remaining parachuted fellows are the share suap parasites and should leave MAS, so much damaged done in the last 11 months..

When it comes to criticising MAS, we have to thank YB Wee Choo Keong and some of the industry insiders in carrying the torch to keep MAS on its toes.

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