KUALA LUMPUR (July 27): Prime Minister Tun Dr Mahathir Mohamad has "welcomed" the offers of resignation from the entire board of Khazanah Nasional Bhd.

In a statement by the Prime Minister's Office today, Dr Mahathir said the resignation offer will "enable the government to restructure the sovereign wealth fund accordingly".

Emphasizing that the government is "not on a witch hunt", Dr Mahathir did not discount the possibility of the individuals being re-designated to other entities or even retained "to allow for continuity".

"We do not regard everyone as guilty of everything, but this administration will not accept obvious wrongdoings.

"This action of clearing the deck will allow restructuring as our (the government's) policies are now different," said Dr Mahathir.

"While we believe in paying good salaries, we cannot all the time base it on commercial rates. We would rather focus on rewarding with good bonuses tied to performance as some companies may not perform as they should," he added.

Khazanah, in a statement yesterday, confirmed that group managing director Tan Sri Azman Mokhtar and eight other board members offered their resignations en-masse to Dr Mahathir earlier this week "to facilitate a smooth and orderly transition under the new government".

That same day, six listed companies under Khazanah's control — Axiata Group Bhd, Malaysia Airports Holdings Bhd, Telekom Malaysia Bhd, CIMB Group Holdings Bhd, UEM Sunrise Bhd and UEM Edgenta Bhd — collectively lost RM2 billion in market capitalisation, according to news reports.

Dr Mahathir described the wipe-out as "paper losses", justifying that it "was nothing" compared with the national debt of RM1 trillion inherited by the previous administration.

"The amount of debt is real, the amount needed to service the debts is real," he said.

"And most of the amounts 'invested' by the previous administration has yet to be recovered as we do not know where they have been invested in," he added.

After the historic 14th general election on May 9, the new Pakatan Harapan government said the national debt level was at RM1.09 trillion at Dec 31, 2017, and not RM686.8 billion as asserted by the previous Barisan Nasional (BN) government.

This was after including the total government debt, government guarantees and lease payments for public-private partnerships, Finance Minister Lim Guan Eng clarified in May.

The method of calculation has been questioned by former prime minister and ex-BN honcho Datuk Seri Najib Razak, who is the first Malaysian premier to be ousted in a general election.

Najib has also criticised the new government of "returning to bygone era" following the latter's decision to revert to old systems such as the sales and services tax, in favour of the more commonly-practised goods and services tax, which his administration introduced in 2015.

Dr Mahathir, in response, asked the public whether the people "preferred to return to the era of Najib's administration".

"The bygone era is the era when Malaysia was known as an Asian Tiger. Is he (Najib) saying that the people should be taken back to the era when the nation was known as a kleptocracy led by a kleptocrat?" asked Dr Mahathir.