Lawyers, former ministers say Tabung Haji-1MDB land deal needs Cabinet oversight



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KUALA LUMPUR (May 16): Lembaga Tabung Haji’s controversial land deal with 1Malaysia Development Bhd (1MDB) should have been brought to the Cabinet, lawyers and former ministers said, following reports that the matter was not discussed by sitting ministers.

Constitutional law professor Dr Abdul Aziz Bari wanted to know who was making decisions for the government, if something as serious as multi-million ringgit land deal involving a trouble state-backed firm did not go through the Cabinet.

“Taxpayers’ money was used, but the Cabinet was not consulted or the decision did not come from the Cabinet. It may have come from the prime minister, and that becomes a problem,” Aziz said when commenting on the pilgrims' fund's recent purchase of land from the debt-ridden state investment firm.

He said that since the people had given the Cabinet their mandate, any decision relating to public interest should go through the body first. The ministers, as elected representatives, were also answerable to the Dewan Rakyat or lower house of Parliament, Aziz added.

“You are using the people’s money, but the mechanism that holds the people’s mandate is not consulted. That is the problem,” said Aziz.

“If you look at the constitution, the Cabinet must answer to Parliament or the Dewan Rakyat, so you can ask them questions.

“But now none of the ministers know anything of this deal, so that becomes a major concern,” said Aziz.

MCA deputy president Datuk Dr Wee Ka Siong, a minister in the Prime Minister's Department, has said that the land deal was not discussed at the Cabinet.

“The recent purported land deal between Tabung Haji and 1MDB has been controversial as it puts in question our principles of good governance and transparency,” Wee had tweeted days after news broke about the deal.

Tabung Hajib in April bought 0.63ha of land from 1MDB's Tun Razak Exchange for RM188.5 million. The purchase was swiftly condemned by the pilgrims' fund depositors and both opposition and ruling politicians.

Anger centered on the fact that 1MDB's RM42 billion debts were a known fact, and also that the strategic investment fund, which is owned by the Finance Ministry and of which Prime Minister Datuk Seri Najib Razak is advisory board chairman, had paid far cheaper for the land when it bought it from the federal government years ago.

1MDB had paid RM64 per square feet, in contrast to the RM2,773 psf paid by Tabung Haji, prompting speculation that the deal was a form of bailout for the investment firm that is due to service interest payments.

Civil society and opposition politicians have also narrowed in on the conflict of interest between Tabung Haji top executives and board members, who also hold positions in 1MDB, although the pilgrims' fund has said it was careful to ensure that such persons abstained from the decision-making.

Aziz said the problem stemmed from the fact that the prime minister was also the finance minister, and this removed all checks and balances and created a conflict of interest.

Aziz said this practice began during the time of Tun Dr Mahathir Mohamad, when the then-prime minister sacked former finance minister Datuk Seri Anwar Ibrahim from government in 1998 and took over the latter’s portfolio.

Universiti Malaya (UM) Associate law professor Dr Azmi Sharom (pic, right) echoed Aziz’s opinion and said that the Cabinet was crippled by the fact that Datuk Seri Najib Razak held two portfolios.

“The issue here is check and balance,” Azmi told The Malaysian Insider.

However, constitutional lawyer Syahredzan Johan said that Tabung Haji’s transactions needed only the minister’s approval, and did not have to go through the Cabinet.

But he added that in this particular case, the issue should have been brought before the Cabinet to be debated.

“First, we have to look at the Tabung Haji Act and see whether such transactions need the Cabinet’s approval, since they have their own decision-making board and committee.

“Some statutory bodies need the minister’s approval, but not necessarily the Cabinet’s. However, I feel that if it is a major issue, it should go through the Cabinet first even though the minister’s approval would suffice.”

Minister in the Prime Minister’s Department Datuk Seri Jamil Khir Baharom is the minister in charge of Tabung Haji. He did not respond to The Malaysian Insider's requests for a comment.

The minister in charge of Islamic affairs has yet to issue a statement over the entire fiasco, and thus far only Tabung Haji chairman Datuk Seri Abdul Azeez Abdul Rahim has spoken publically on the matter.

However, Aziz said Jamil, and not Azeez, should be addressing the public on the issue, given that he is the Cabinet member in charge of Tabung Haji.

“Who is Azeez? He may be a Barisan Nasional parliamentarian, but he is not a Cabinet member, so how can he determine policies? Why is Najib dealing with him directly and not going through the Cabinet?” asked Aziz.

Former Cabinet minister Tan Sri Zainuddin Maidin told The Malaysian Insider that matters of public interest can no longer be dealt in secret.

“In every case, a minister will present a working paper before the Cabinet,” Zainuddin said of the decision-making process in the Cabinet.

“Matters of public interest should not be handled secretly, especially in this modern day and age where information leaks out so easily.”

Former de facto law minister Datuk Zaid Ibrahim said important matters were usually discussed in Cabinet, yet, under Najib’s administration, ministers appeared to be unaware which issues were considered important.

“The Cabinet should discuss all issues, nothing can be considered a small issue. In this case, it is clear major issues are not being discussed in Cabinet. For instance, 1MDB – it is clear they know nothing about it.”

He added that the Tabung Haji land deal reflected badly on Najib as the latter had allowed the transaction to take place.

Another former minister Datuk Saifuddin Abdullah said major issues were always brought to Cabinet, and this should include something as important as 1MDB.

“As far as I know, major issues involving laws and policies are decided in Cabinet.

“Issues such as 1MDB are definitely discussed in Cabinet, I should think. But Tabung Haji’s land purchase may be under the autonomy of the minister in charge,” he said.

The news that Tabung Haji had bought land from 1MDB was first leaked by an anonymous blog and was subsequently confirmed by the pilgrims' fund. Tabung Haji has since said it will sell the land on the advice of the prime minister.