Thursday 28 Mar 2024
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KUALA LUMPUR: Officials from the Ministry of Finance (MoF) have met with the Barisan Nasional Back Benchers Club (BNBBC) on a controversial Bill to allow the ministry to set up an investment panel within the Inland Revenue Board (IRB) in a move seen by many to pass the Bill quickly when it goes for its second reading in Parliament this week. It is understood the briefing was held at the Putra World Trade Centre (PWTC) last Thursday.

There are 77 BNBBC members who currently form more than half of the total of 134 BN Members of Parliament (MPs). Their show of hands plays a crucial role for the government to be able to get at least a 51% vote for the Bill to be passed.

If passed, the Bill would allow the finance minister — currently Prime Minister Datuk Seri Najib Razak — to set up an investment panel within the IRB to make investments using taxpayers’ money to acquire stocks, bonds, debts and property assets.

There are a total of 222 MPs, out of which 134 (60%) are from BN and the remaining 88 MPs (40%) form the opposition. BNBCC members are MPs who do not hold any position as minister or deputy minister in the government.

“Such briefings are normally held in hotels outside Parliament grounds on Thursday nights since there is no sitting the following day. However, last Thursday’s briefing was held at PWTC,” a source told The Edge Financial Daily.

“This is so that they [BNBBC members] will be able to prepare themselves and debate constructively on the Bill the following week when it is put to a vote,” said the source. The current Parliament is in session from June 9 till 19. BNBBC chairman Tan Sri Shahrir Samad (BN-Johor Baru) could not be reached for comment.

Last Thursday, Wong Chen (PKR-Kelana Jaya) unveiled the government’s plans to amend the Inland Revenue Board of Malaysia Act 1995 to allow the MoF to set up an investment panel within the IRB.

However, economists have questioned the need for IRB to move into the investment arena when there are already state-owned investment bodies like 1Malaysia Development Bhd (1MDB), the Employees Provident Fund and Khazanah Nasional Bhd.

Wong had earlier pointed out that the amendment would give the finance minister powers to appoint six out of the seven members sitting on the investment panel.

“The Bill will be heard for its second and third reading this week before it is voted and passed,” Wong told The Edge Financial Daily last Friday. “There is a possibility that if the issue becomes too hot, it could be pushed to the next Parliament sitting in October.”

Wong said he has called on Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz to explain her involvement in the proposed investment panel.

“[Dr] Zeti needs to answer why she has a role [in the IRB] now,” he said.

Presently, IRB’s board of members consists of the MoF secretary-general (who is expected to be the proposed investment panel’s chairman), the Attorney-General or his representative, the director-general of Public Service or his representative, not more than two other persons representing the government (who will be appointed by the finance minister) and not more than two other persons who shall be appointed by the finance minister.

When contacted, Public Accounts Committee (PAC) chairman Datuk Dr Nur Jazlan Mohamed told The Edge Financial Daily the PAC has the authority to audit any government body, especially when it concerns public money.

“I also want to know why there is a need for the government to set it up [the investment panel within the IRB],” he said, noting that he has not been briefed on the reasons for the move behind the Bill.

One of the amendments to IRB Act includes new provisions that would allow the panel to invest in shares offered pursuant to an initial public offering (IPO), which Wong said could mean that the IRB could become a cornerstone investor for 1MDB’s upcoming IPO.

The amendment to the Bill would only provide wider powers to the government to use taxpayers’ monies to buy stocks, bonds and even properties. Najib is currently the chairman of 1MDB.


This article first appeared in The Edge Financial Daily, on June 16, 2014.


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