Assault On Legislature, Constitution Dead

by
Malik Imtiaz Sarwar

Discussing the Perak situation with specificity is, by this stage, a difficult thing to do. So much has happened so quickly. Nuanced actions and counter-actions, some of it in uncertain legal terrain, and relatively scarce details have made it precarious to consider certain key events – the legal action against the Speaker and its incidents, for instance – with the depth that only certainty would allow for.

Having said that, whatever the specifics may be and whoever may be right as to the validity or legality of certain aspects of the unfolding saga, when considered from a broader perspective and with reference to the fundamentals of democracy, I do not think that the situation in Perak is very complicated at all. As Tengku Razaleigh recently observed, a chain-reaction of illegality has left Perak possibly without a legitimate government and the Constitution a dead piece of paper.

I was too young to fully appreciate the terrible impact on democracy that the events of 1987 and 1988 had. Understanding came later, as I learnt to see what needed to be seen: the supremacy of the Constitution, the separation of powers and the check and balance it is aimed at, the independence of the judiciary and, correspondingly, the legislature. But even as my awareness of what had happened and how it had happened increased, I rather naively found myself thinking that it was unlikely that we would ever see anything of the likes again. Those events had simply been too heinous and the injuries inflicted on this nation too serious to ignore, even by those who had been responsible and those who would possibly follow in their footsteps.

Or so I thought.

The savagery of what has happened in Perak and the utter disregard of consequence on the part of those orchestrating the campaign go far to show how foolish I was to have believed that all of us, without exception, recognize that some costs are too great and for that, even blind ambition has its limits. It is clear now that this is not necessarily the case; for some, even the nation itself is expendable.

In saying savagery, I recognize that there has been neither bloodshed nor preventive detentions, though it is still too early to say for sure that things will stay that way. The incitement carries on, and mobs are being driven to frenzy to the throb of the war drums. Amidst the calls for blood, bullets have been sent, a disabled parliamentarian assaulted and some of his colleagues battered. The police have apparently too much on their hands to move with the speed that they are capable of and, as such, as things stand serve no useful role as the deterrent that the situation sorely requires.

Violence has however been done; to the Federal and State constitutions, to the Rule of Law and to all that these fundamentals represent. War has been waged on democracy itself.

I can think of no other way to characterize events.

As thing stands, the Speaker is still the Speaker. He has been at all times vested with the full powers of his office and the discretion to exercise those powers. He may have committed mistakes in arriving at certain decisions, but those are matters for the Legislative Assembly itself or, where legal limits have been transgressed, for the courts whose powers in this regard are limited by reason of the separation of powers. Until corrected, the Speaker’s decisions stand, be they the acceptance of the resignation of the three members who crossed the floor, the issuing of the show cause notices to the alleged usurpers of power and the effecting of their suspension, or the calling of the emergency sessions of the Assembly.

And yet under the hand of the Executive, in a manner reminiscent of the locking up of the Supreme Court in 1988 the Legislative Assembly itself was put out of bounds to members of the Assembly, This was done at the instigation of the State Secretary, an officer of the executive and as such its representative, with the assistance of a police force duty bound to protect the system of governance and associated freedoms put in place by the constitutions of this nation.

In doing so, the Executive laid siege on the Legislature. The sight of the Federal Reserve Unit barring the way into the Legislative Assembly, fangs bared and water cannon poised, was as close a physical depiction of democracy being taken hostage as we will ever see. The underlying intention of the exercise brings this further into relief. It was apparent that the Assembly had to be prevented from meeting for as long as it took for the lawyers to do what they could in court. Injunctions against the Speaker had been applied for. Once these were granted, the process that the Speaker had started would be brought to a halt.

The fact that the injunctions had been applied for shows clearly how far democracy was subverted. The making of the applications underscores awareness on the part of those orchestrating the campaign that self-help was not permissible. The validity of the Speaker’s actions had to be tested before a court of law. If they were not needed, the injunctions would not have been sought.

Despite this appreciation of the obvious, the might of the state was brought to bear. A federal agency was brought in and tasked to do what it was not mandated by law to do: keep the Assembly at bay to protect the interest of a coalition of political parties.

There is no law that allows police officers to deny members of a legislative chamber access to that chamber for the business of Legislature. It is not for any police officer to unilaterally determine that the business being conducted is not within the ambit of the legislature, no matter who might say it is. What the police force did was not justified in law. No crime had been committed. Though the gathering masses was reason enough for a police presence, breaches of the peace did not occur nor were orders to disperse issued, unsurprising given that the focal point was the denial of access to the Legislative Assembly.

It is glaringly obvious that confronted with a scenario that left it vulnerable to a tactical maneuvering of legislative procedure, and an inability to resolve the imbroglio to advantage, the Barisan Nasional at the state and federal level collectively took the law into its own hands. The plan to capture Perak had run into a brick wall and rather than go around it, they decided to blow it up and everything else with it.

The situation is comparable to a hypothetical scenario in which Pakatan Rakyat Members of Parliament barricaded Parliament House to deny Barisan Nasional Members and the Speaker access so as to prevent them from legitimately making a law that they would otherwise have. The only difference is if that had occurred, the Barisan Nasional would have denounced the exercise as an attempted coup d’etat and punished those involved to the full extent of the law at its disposal.

It does not make any difference that that the Barisan Nasional forms the Federal government of the day and is in a position to direct the police force; like all other institutions, these institutions are bound to act constitutionally and in accordance with the law. Malaysia is still a democracy predicated on constitutional supremacy. The expectation that all affairs will be conducted to the exclusive convenience and the advantage of the Barisan Nasional and its leaders is more suited to a dictatorship in which the Rule of Law means nothing.

Through the last week Malaysians have borne witness to a shameless display of belligerence and arrogance. We have heard a senior minister describe the emergency session, held by necessity under that now immortalized rain-tree, as “uncivilized”. Another senior minister described the Speaker as a ‘boy’. Though in line with the other ridiculous observations of ambitious UMNO leaders that Malaysians have had to endure since the beginning of the Perak affair, they do little to mask the obvious; that the Barisan Nasional appears to see no limits to what it is permitted to do to achieve its objectives.

And if it could do this in one state, what is to stop it from acting in the same way in other states or at the federal level. Judging by the way in which it has responded to criticism over its actions these past few weeks, it would seem nothing much. It is manifest that the Barisan Nasional considers itself a law unto itself.

That is the painful truth that lies at the heart of Tengku Razaleigh’s declaration that the Constitution is dead.

                This entry was posted on Monday, 9 March 2009, 7:49 am and is filed under
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Wow! MCA Minister and Deputy Minister  publicly telling  the “lame-duck” PM and UMNO President to buzz off!

It was only last October that the Prime Minister, Datuk Seri Abdullah Ahmad Badawi denied  that
“UMNO  is big bully in Barisan Nasional”
 when he spoke at the MCA General Assembly.

This makes it all the more unusual the spectacle of a MCA Minister and Deputy Minister  publicly  tell the “lameduck” Prime Minister and UMNO President to “buzz off” as evident from the following news reports:

(1)
New Sunday Times (
8.3.09)
–
“PM: Resolve language issue before it gets out of hand”
 –

KUALA LUMPUR: The prime minister wants the Education Ministry to decide quickly whether Science and Mathematics should continue to be taught in English.

Datuk Seri Abdullah Ahmad Badawi said the contentious issue  should be resolved before it got out of hand.

“This issue has become bigger and more sensitive. I hope the ministry will make a decision on the matter fast.

“If not, the issue will become even bigger and the pressure from non-governmental organisations will continue,” he said after launching a fantasy novel written by 13-year-old Adam Umemoto titled Dragonfire Hammer.

(2)	Asked to comment on Prime Minister Datuk Seri Abdullah Ahmad Badawi’s call for a quick decision on the policy’s future, Hishammuddin said only the cabinet could make the final decision.

He said his ministry was responsible for collecting and presenting facts and figures to the cabinet, which would then make a decision based on the findings of a 21/2-month study on the policy’s progress.

Hishammuddin said the outcome of the study, which was started after the Ujian Pencapaian Sekolah Rendah results were released in December last year, would be presented to the cabinet “in the near future”.

But he will first have to address a memorandum on the results that would in turn be sent to the relevant ministries and agencies for feedback.

A final report would then be generated to be given to the cabinet to help it decide on the policy’s future, he added.

Hishammuddin urged calm and the public’s understanding to allow the government to make the right decision.
(New Straits Times 9.3.09)

3. Deputy Education Minister Datuk Dr Wee Ka Siong said those seeking to scrap the policy should check their facts before pointing fingers.

“We don’t make decisions on the behalf of the government. We are only the executing authority. The decision to use English for the teaching of Science and Mathematics was a collective decision made by the cabinet in 2002.”

He urged detractors of the policy to be patient until Education Minister Datuk Seri Hishammuddin Hussein tabled a working paper on the matter.

Cabinet members are expected to make a decision based on the paper.

Wee, who was responding to Saturday’s march by some 5,000 protesters against the policy, added that Hishammuddin was upset by allegations made in a police report that he had a hidden agenda in pushing for the move.

“It’s as though people are not looking back into history. To set the record straight, Hishammuddin was appointed to the post in 2004 and he is just continuing an existing policy.”
(NST 9.3.09)

4. “The final decision will only be made after a working paper has been presented to the Cabinet.” – MCA President Datuk Seri Ong Tee Kiat. (NST 9.3.09)

This is as good as the MCA Minister and Deputy Minister publicly rebuking  Abdullah for not knowing what he was talking about on the subject.

But then, they are only following in the footsteps of the outgoing  UMNO Youth Leader, UMNO National Vice President aspirant and Education Minister, Datuk Seri Hishammuddin Hussein in publicly snubbing Abdullah’s call to the Education Ministry to “decide quickly” on the six-year controversy on the use of English to teach science and mathematics from Standard One.

Wow, it is indeed a sight to see – a MCA Minister and Deputy Minister  publicly telling the lame-duck Prime Minister and UMNO President to buzz off, but this is done only in the comfort and security after  a public snub to Abdullah by Hishammuddin!

How quickly Pak Lah has fallen in the public esteem of UMNO, MCA and other Barisan Nasional leaders although he is still in name the Prime Minister for the next few weeks!

                This entry was posted on Monday, 9 March 2009, 12:50 pm and is filed under
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“Perak Speaker must be represented by State Legal Adviser” –   Government Proceedings Act 1956 Irrelevant

(By CKO, an Advocate practicing in Sabah, who has no political affiliation.)

1.	Much has been said on the recent legal battles in Perak in the first week of March 2009, including the decision of the Ipoh High Court to grant an Order against the Speaker under Section 44(1) of the Specific Relief Act 1956. The Ipoh High Court apparently has ruled that because of the Government Proceedings Act 1956 (“GPA”), the State Assembly Speaker must be represented by the State Legal Advisor in the relevant legal proceedings. However, it is my humble view that the GPA was
not applicable at all.

State Speaker Must be Represented by the State Legal Advisor?

2.	There is no official report yet on the actual legal basis for the High Court’s rulings on this point, so we can only rely on the press reports. It has been reported that:-

“Mohd Hafarizam had argued that the Speaker’s own lawyers could not represent him as he was considered “part of the government”, and therefore only the state legal adviser could act for the Speaker and State Assembly members.”

(
Speaker restrained from convening ‘State Assembly meetings’
; The Star, Wednesday, March 4, 2009)

http://thestar.com.my/news/story.asp?file=/2009/3/4/nation/3399999&sec=nation

“Datuk Hafarizam Harun, who is leading the lawyers representing the three independent state representatives who switched to support Barisan Nasional, said Sivakumar could use private lawyers only if he resigns.

“Then we can elect a new speaker from the Barisan Nasional,” Hafarizam said, reflecting Barisan Nasional’s strategy to oust the speaker.

He added that Sivakumar
had no choice but to use the SLA even if he had no faith in that person. “The prime minister also has to use the Attorney-General. It is not a matter of choice.””

(
High Court: Sivakumar must be represented by state legal adviser
; The Malaysian Insider, Thursday, March 5, 2009)

http://www.themalaysianinsider.com/index.php/malaysia/19690-high-court-sivakumar-must-be-represented-b

3.	Presumably, such a sweeping argument made by the lawyers representing the Perak Barisan Nasional was based on Section 24 of the GPA:-

“24. Appearance of law officers.

(1) Notwithstanding any written law-

(a) in civil proceedings by or against the Federal Government a law officer, the Parliamentary Draftsman or a Federal Counsel, or, in the case of the States of Sabah and Sarawak, a legally qualified member of the Federal or State Attorney General’s Chambers authorised by the Attorney General for the purpose; and

(b) in civil proceedings by or against the Government of a State a law officer, the Parliamentary Draftsman or a Federal Counsel authorised by the Legal Adviser of such State, and, in the case of the States of Sabah and Sarawak, the State Attorney General or any legally qualified member of the State Attorney General’s Chambers authorised by the State Attorney General for the purpose;

may appear as advocate on behalf of such Government and may make and do all appearances, acts and applications in respect of such proceedings on behalf of the Government.

(2) Notwithstanding any written law in civil proceedings to which a public officer is a party-

(a) by virtue of his office; or

(b) in his personal capacity, if the Attorney General certifies in writing that it is in the public interest that such officer should be represented by a legal officer;

a legal officer may appear as advocate on behalf of such officer and shall be deemed to be the recognised agent of such officer by whom all appearances, acts and applications in respect of such proceedings may be made or done on behalf of such officer.”

4.	However, it is my humble view that if the Perak Barisan Nasional’s application was a Judicial Review application, then Government Proceedings Act 1956 does not apply. It is actually irrelevant whether the Speaker was deemed ‘part of the government’ or not, as the GPA is totally not applicable and therefore it cannot be the basis to bar the Speaker from appointing any lawyer of his own choice. This is because the phrase “civil proceedings” in that Act has a specific meaning.

5.	Just because the application was not ‘criminal’ in nature does not necessarily mean that it was therefore ‘civil’. With all due respect to the High Court and the lawyers acting for the Perak BN, such leap of logic shows a fundamental ignorance of the scope of the Act and what the Act was designed to achieve. (For the history and purpose behind the GPA, see the Appendix.)

6.	Section 2 of the Government Proceedings Act 1956 provides:-

“”civil proceedings” means any proceeding whatsoever of a civil nature before a court and includes proceedings for the recovery of fines and penalties and an application at any stage of a proceeding, but does not include proceedings under Chapter VIII of the Specific Relief Act 1950, or such proceedings as would in England be brought on the Crown side of the Queen’s Bench Division;”

7.	In other words, “civil proceedings” under GPA is referring only to civil claims such as tort and contract, and does not include proceeding concerning public law issues or the exercise of public or governmental power, which are called ‘Judicial Review’ proceedings. In England, Judicial Review proceedings are, traditionally, started/brought in a specific Division of the High Court, i.e. on the “Crown side” of the Queen’s Bench Division of the High Court; and the orders made by this Division of the High Court are called ‘prerogative orders’, such as mandamus (to force a person or entity exercising public power to do an act), prohibition (to prevent a person or entity exercising public power from doing an act), certiorari (to set aside the decision of a person or entity exercising public power) and so on.

8.	In Malaysia, Judicial Review proceedings could also be brought under Chapter VIII of the Specific Relief Act 1956 (“SRA”). The Order granted by the Ipoh High Court to purportedly restrain the Perak Speaker from convening the State Assembly meeting appears to be granted under Section 44(1) of the SRA, which is part of Chapter VIII of the SRA. Chapter VIII of the SRA includes:-

CHAPTER VIII – ENFORCEMENT OF PUBLIC DUTIES

“44.  Power to order public servants and others to do certain specific acts.

45.  Application how made and procedure.

46.  Peremptory order.

47.  Execution of, and appeal from, orders.

48.  Costs.

49.  Bar to issue of mandamus.”

9.	Therefore, the application before the Ipoh High Court must be a Judicial Review proceedings, and therefore not within the meaning of ‘civil proceedings’ under the GPA.

10.	In other words, by defining ‘civil proceedings’ as not including those “Crown side” proceedings, Section 2 of the GPA has expressly said that the GPA as a whole is irrelevant and not applicable when it comes to Judicial Review proceedings (‘Crown side’ prerogative orders) or applications under Chapter VIII of SRA.

11.	The principle that “civil proceedings” under the GPA does not include Judicial Review has been confirmed by the Court more than 15 years ago in a landmark public law case decided by the highest court in England, the House of Lords, in M v Home Office [1994] 1 AC 377, [1993] 3 WLR 433, [1993] 3 All E.R. 537. Although this was a case from England, it was deemed so important that it has also been reported in the local Malaysian law reports as In re M (A. P.) [1993] 3 CLJ 567 (and cited by our own Federal Court recently in Minister of Finance, Government of Sabah v Petrojasa Sdn Bhd [2008] 5 CLJ 321), so there was really no excuse for any lawyer claiming to specialize in public law to be ignorant about it. The House of Lords in that case says @ In re M (A. P.) [1993] 3 CLJ 583b-f:-

“The language of s. 23 makes it clear that Part II of the Act does not generally apply to all proceedings which can take place in the High Court. In particular, it does not apply to the proceedings which at that time would have been brought for prerogative orders…

‘Civil proceedings’ includes proceedings in the High Court or the county court for the recovery of fines or penalties, but does not include proceedings on the Crown side of the [Queen’s] Bench Division.

Proceedings for the prerogative orders were brought on the Crown side.”

12.	This interpretation was strengthened by the House of Lords’ decision about 4 years ago in Davidson (AP) v Scottish Ministers [2005] UKHL 74. The highest court of England clarified the legislative purpose of the English Crown Proceedings Act 1947 (and hence the Malaysian GPA too, because the GPA was modeled on the Crown Proceedings Act 1947). Lord Nicholls of Birkenhead says:-

“15. 	In English law the phrase ‘civil proceedings’ is not a legal term of art having one set meaning. The meaning of the phrase depends upon the context. For instance, the phrase is often used when contrasting civil proceedings with criminal proceedings. So used, and subject always to the context, civil proceedings will readily be regarded as including proceedings for judicial review.

16. 	This usage was not intended in the 1947 Act. That is clear beyond doubt. Proceedings on the Crown side of the King’s Bench Division were the predecessors to applications for judicial review, and the definition of ‘civil proceedings’ in section 38 of the Act states expressly that ‘civil proceedings’ does not include proceedings on the Crown side. Thus section 21 was not applicable to Crown side proceedings.

18.	Accordingly, with one immaterial exception in section 25, Crown side proceedings were not the subject of reform by the 1947 Act. The remedies available in Crown side proceedings were not affected by the Act. Prerogative writs and orders, including mandamus, had long been issued against officers of the Crown: see Lord Parker CJ in R v Commissioners of Customs and Excise, Ex p Cook [1970] 1 WLR 450, 455. The 1947 Act did not touch this jurisdiction.”

13.	On the other hand, it should be noted that it would be improper and beyond the power of a civil court hearing a civil claim (of tort, contract and so on, which is not a Judicial Review application) to grant an ‘injunction’ to ‘injunct’ a person exercising public law power – such as the Perak Speaker in this case. This is because the Perak Speaker’s actions, even if wrongful, were not a private law contractual or tortuous wrong.

14.	The only correct way to challenge the Speaker’s decision was through the public law Judicial Review proceedings (whether the challenge will succeed or not is a different matter, see below). This is a very elementary conceptual difference between public/administrative law and private/civil law, which the Judicial Commissioner and the lawyers acting for the Perak BN were surely well aware of. Therefore, there is no question that the application brought to stop the Perak Speaker from convening the State Assembly meeting must be a public law, Judicial Review proceedings, in which case the GPA was totally not applicable, including the Section which purportedly ‘requires’ a ‘public officer’ to be represented by the Sate Legal Advisor.

15.	To sum up, it is my humble view that the Ipoh High Court was wrong in law to disallow the Speaker to engage his own lawyer in any public law proceedings, based on Section 24 of the GPA – or any other provision of the GPA for that matter.

16.	As to the following argument:-

“According to Hafarizam, the grounds of judgment were based on the test of payment. “Although the speaker is not paid by the ordinary public services commission, he is paid under the consolidated fund which comes from the state so there is no issue that he is not a branch of the government.”

… But Hafarizam interpreted it differently. “We are not denying that the speaker is not a public servant as they come under JPA (Public Service Department). But the speaker is a public officer exercising public duty and has a public office so you are part of government.””

17.	With due respect, such talks are misleading and conceptually ambiguous. If this logic holds water, the Separation of Powers could be simply destroyed by the bizarre ‘test of payment’ – because as a matter of fact, all 3 Branches of the Government are paid by the Consolidated Fund! Of course, because the money in the Federation/State Consolidated Fund simply means money which belongs to the Federation/State as a whole, but is ultimately controlled by the Legislature.

18.	In law, the terms ‘public office’ and ‘government’ have specific and varied meanings depending on the applicable laws and contexts. It cannot be based on this completely unheard of ‘test of payment’. As Lord Nicholls of Birkenhead says in Davidson, para 15, “In English law the phrase ‘civil proceedings’ is not a legal term of art having one set meaning. The meaning of the phrase depends upon the context.”

19.	In any event, it is very obvious that the State Legal Advisor, like the Federal Attorney General, sits in the State Cabinet/Executive Council (or below), i.e. s/he is a member of the Executive Branch of the Government. Therefore, since we have Separation of Powers in our system between the Legislative, Executive and Judicial Branches, it is unrealistic (if not unconstitutional) to expect the State Legal Advisor to act for the Speaker in a tussle between the Legislative and the Executive Branches of the Perak Government. The State Legal Advisor would be caught in a situation where s/he was forced to take side between his own Executive Branch and the opposing Legislative Branch. The State Legal Advisor could not be ignorant about this irreconcilable conflict of interests. (Putting aside the fact that the State Legal Advisor is at the same time also acting on behalf of the BN Executive Branch of the Government against the former Menteri Besar of Pakatan Rakyat, the Speaker’s coalition.)

20.	Such a grave legal mess, if not quickly addressed or further clarified, has the potential to make our Courts a Commonwealth (at least) laughing stock.

Order under Section 44(1) of the Specific Relief Act 1956 against the State Speaker?

21.	The Order granted to restrain the Perak Speaker from conducting the State Assembly meeting was purportedly made under Section 44 of the Specific Relief Act 1956 (“SRA”). Section 44(1) says:-

“Power to order public servants and others to do certain specific acts.

(1) A Judge may make an order requiring any specific act to be done or forborne, by any person holding a public office, whether of a permanent or a temporary nature, or by any corporation or any court subordinate to the High Court:

Provided that – …”

22.	It appears that the only relevant basis used by the lawyers acting for the Perak BN to justify the Order under this section was that the Perak Speaker was a “person holding a public office” by applying the innovative ‘test of payment’.

23.	The meaning of this phrase has been recently decided by the highest court in Malaysia by reference to Article 132 of the Federal Constitution. In Minister of Finance, Government of Sabah v Petrojasa Sdn Bhd [2008] 5 CLJ 321, the Chief Justice says:-

“[15] The answer to the question depends on, first, who is a “person holding a public office”? In Loh Wai Kong v Government of Malaysia & Ors [1978] 1 LNS 106, Gunn Chit Tuan J (as he then was) held:

However, according to sub-section (1) of s. 44 of the Specific Relief Act 1956, an order can only be made against any person holding a public office … According to s. 3 of the Interpretation Act, 1967, “public officer” means office in any of the public services, and “public services” means the public services mentioned in art. 132(1) of the Federal Constitution. Therefore, 1 and 2 respondent in this case, namely the Government of Malaysia and the Menteri Hal Ehwal Dalam Negeri, Malaysia who are not persons holding a public office within the meaning of s. 44 of the Specific Relief Act have, in my view, been wrongly cited as respondents.

[16] In other words, since the Government of Malaysia and the Minister of Home Affairs are not “persons holding a public office”, an order pursuant to s. 44 of the SRA cannot be issued against them. Regarding the other two respondents, ie, the Ketua Pejabat Imigresen, Pulau Pinang and the Pegawai Paspot, Pulau Pinang even though they were held to be persons holding a public office, nevertheless the order prayed for was refused by the learned judge because the applicant had failed to fulfill the five conditions set out in the proviso to sub-s. (1) of s. 44 SRA.

[19] With respect, I do not agree with the approach and the interpretation given by the Court of Appeal. If words used in statutes are defined, it is that meaning that the court should give to them. It is not right for the court, purporting to give a “wider interpretation”, to give a meaning different from what is defined by statute.

[20] SRA does not define the words “public office”. However, “public office” is defined by the Interpretation Acts 1948 and 1967 (Act 388) (“IA”) as follows:

“public office” means an office in any of the public services;

“public officer” is defined as follows:

“public officer” means a person lawfully holding, acting in or exercising the functions of a public office.

[21] What is “public services”? Art. 132(1) of the Constitution provides:

132(1) For the purposes of this Constitution, the public services are:

(a) the armed forces

(b) the judicial and legal service

(c) the general public service of the Federation

(d) the police force

(e) (Repealed)

(f) the joint public services mentioned in Article 133

(g) the public service of each State; and

(h) the education service.

[22] Clause (3) provides:

(3) The public services shall not be taken to comprise:

(a) the office of any member of the administration in the Federation or a State; or

“Member of the administration” is defined in Article 160 as follows:

“Member of the administration” means, in relation to the Federation, a person holding office as Minister, Deputy Minister, Parliamentary Secretary and, in relation to a State, a person holding a corresponding office in the State or holding office as a member (other than an official member) of the Executive Council.

[23] It is clear that the Minister of Finance, Government of Sabah is “a member of the administration” but not a “person holding public office.” What it means, in relation to s. 44 SRA is that s. 44 SRA is not applicable to the appellant, meaning that an order under s. 44 SRA cannot be issued against the appellant. To that extent the High Court judge Gunn Chit Tuan J, was right in Loh Wai Kong (supra) regarding the effect of s. 44 SRA on the Government of Malaysia and the Minister of Home Affairs. In my view the learned High Court judge in the instant appeal was right in following Loh Wai Kong (supra) and the Court of Appeal was wrong in its interpretation of s. 44 SRA.”

24.	In other words, in deciding whether the Perak Speaker (or any other person for that matter) was “a person holding a public office” (hence can be controlled by a High Court Order under Section 44 of the SRA), the answer lies in Article 132 of the Federal Constitution, and not some bizarre, hitherto unheard of ‘test of payment’.

25.	So, regardless of what is stated in the Perak State Constitution or who pays for their lunches and official cars, based on the Federal Court’s decision in Petrojasa, an order under Section 44 of the SRA could not be issued against any member of the Perak State Executive Council (i.e. the Executive Branch)  because they are not a “person holding a public office” (and therefore not subject to the Court’s control) under Section 44 of the SRA. If that is the case for the Executive Branch, why should the State Speaker – being the head of a different, sovereign Branch of the government – be a “person holding a public office” (and therefore subject to the Court’s control) under Section 44 of the SRA? If the answer is yes, it would turn the State Speaker into some kind of subordinate officer lower than the Executive and the Judicial Branches. Is the Perak State Constitution so peculiar?

26.	As we have seen, the Federal Court in Petrojasa has ruled that the answer is to be found by referring to Article 132 of the Federal Constitution, which says:-

The public service shall not be taken to comprise –

(a) the office of any member of the administration in the Federation or a State; or

(b) the office of President, Speaker, Deputy President, Deputy Speaker or member of either House of Parliament or of the Legislative Assembly of a State; or

(c) the office of judge of the Federal Court, the Court of Appeal or a High Court; or

(d) the office of member of any Commission or Council established by this Constitution or any corresponding Commission or Council established by the Constitution of a State; or

(e) such diplomatic posts as the Yang di-Pertuan Agong may by order prescribe, being post which but for the order would be posts in the general public service of the Federation.

27.	Therefore, reading Article 132(3) of the Federal Constitution in light of the Federal Court’s decision in Petrojasa, the Speaker of the Perak State Assembly is not a holder of a ‘public office’ or a ‘public officer’. As a result, an order under Section 44 of the SRA cannot be issued by the High Court against the Speaker of the Perak State Assembly. The Ipoh High Court was clearly wrong.

Privileges of the State Assembly – Court Cannot Inquire or Interfere

28.	The Legislature and its Members – being the forum where our people’s representatives are allowed to express the voice the people without fear or favour – are given certain privileges and immunities from legal proceedings. That is why, for example, the Deputy Chief Umno, Y. B. Khairy Jamaluddin said this in response to the accusations made by DAP chairman Y. B. Karpal Singh in Parliament that UMNO Youth was responsible for sending bullets to Karpal Singh in February 2009:-

“Karpal should not hide behind parliamentary immunity to make accusations that had no truth and basis.”

(24 Hours For Karpal To Produce Proof On Bullets; Bernama, February 26, 2009)

	http://www.bernama.com/bernama/v5/newspolitic.php?id=392618

29.	Indeed, the august Legislature (Federal and State) could be said to be the Sovereign Branch among the 3 branches of Government, because the other 2 branches must carry out the wishes of the Legislature as expressed in a duly enacted legislation. Even though the Judiciary can still control the excesses of the Legislature, this could only be done by declaring that a particular legislation passed is invalid for being unconstitutional for contravening the supreme law – either the Federal of the State Constitution. How the legislature conducts its own affairs internally is, to be blunt, none of the Court’s business.

30.	On this point, I can do no better than to quote N. H. Chan, a former Justice of the Court of Appeal:-

“The question is, can the courts decide on the validity of the proceedings in the Legislative Assembly?

The answer is staring right at us here in Federal Constitution. Article 72, Clauses (1) to (3) states:

“(1) The validity of any proceedings in the Legislative Assembly of any State shall not be questioned in any court.

(2) No person shall be liable to any proceedings in any court in respect of anything said or any vote given by him when taking part in proceedings of the Legislative Assembly of any State or of any committee thereof.

(3) No person shall be liable to any proceedings in any court in respect of anything published by or under the authority of the Legislative Assembly of any State.”

So now you know from the Federal Constitution itself that the validity of the suspension of Zambry and his 6 exco members by the Speaker in the State Assembly cannot be questioned in any court.

Lord Denning tried to inquire into a private Act of Parliament on the ground that Parliament was misled by fraud but he failed. The case is Pickin v. British Railways Board [1974] A.C. 765. He recounted this in his book What Next in the Law at page 319:

“A little while ago there was a case where the British Railways Board got a private Act vesting a man’s land in the Board without payment. He alleged that Parliament had been misled by fraud. In the Court of Appeal we held that the judges could inquire into it. But the House of Lords overruled us. They held that no inquiry by the judges could be permitted.”

It is important to remember that the United Kingdom does not have a written constitution. What more when we have a written constitution which says that “the validity of any proceedings in the State Legislative Assembly shall not be questioned in any court”.

From what we have read from the newspapers it seems that there is an injunction against the Speaker. You may also wonder how an injunction can be obtained against the Speaker when our written constitution says that “no person shall be liable to any proceedings in any court in respect of anything said or any vote given by him when taking part in proceedings of the Legislative Assembly of the State”.”

(How to judge the judge? By N. H. Chan, a former Justice of the Court of Appeal)

http://blog.limkitsiang.com/2009/03/06/how-to-judge-the-judge/

31.	The Judge and the lawyers acting for BN here should therefore have borne in mind these fundamental concepts in Constitutional and Administrative law when dealing with this case.

Reform – Curtailing the Speaker’s Powers to Suspend Members

32.	The Speaker of the State Legislative Assembly enjoys great power indeed. Sadly, the power could sometimes be abused.

33.	Before the suspension of numerous Members of the State Legislative Assembly by the Perak Pakatan Rakyat Speaker in February 2009, on 25 April 2005, this awesome power of the Speaker has been used by the then Barrisan Nasional Speaker to suspend the then Selangor State Opposition Leader (now the Speaker) for 5 days. Y. B. Teng Chang Khim himself recounted this episode as follows:-

“The Speaker had repeatedly, for at least not less than 4 times, pronounced in the House in the morning session of the meeting on 25.4.2005 that I had been suspended for 3 days for the alleged offence. However, immediately after the meeting resumed in the afternoon, he announced that I had been suspended for 5 days. How could a judge pronounce an increased sentence on an offender for the very same offence? It is also a cardinal rule in law that a judge becomes functus officio after pronouncing the sentence which means he ceases his function as a judge when a sentence is passed. This is evidently another instance of disregard to rule and abuse of power by the Speaker.

Of course, under the Standing Order, if the Speaker deems the suspension of 5 days on a member is not sufficient, there is a provision under Rule 44(3) of the Standing Order that empowers the Speaker to name the member (in the Assembly meeting, a member can only ordinarily be called by the name of his constituency he represents) and followed by the motion from the frontbenchers to suspend that member for a period of time exceeding 5 days. This procedure was not complied with. Thus, the increased suspension of 5 days was null and void.”

(Press Statement by Y. B. Teng Chang Khim)

http://www.dapmalaysia.org/all-archive/English/2005/Aug05/bul/bul2773.htm

34.	Nonetheless, the ‘legality’ or otherwise of the then Selangor Speaker was never questioned in Court by the then State Opposition, perhaps because they were well aware of, and/or chose to respect, Article 72 of the Federal Constitution.

35.	No doubt, the power could be used undemocratically to oppress the minority/opposition – even by denying the leader of the minority/opposition from attending/speaking at the Assembly, as what happened in Selangor to Y. B. Teng Chang Khim. (Subsequently, the majority of the Selangor State Assembly resolved on 1 August 2005 to further suspend the service of Y. B. Teng for a period of 6 months with all his privileges and allowances stripped of, after serving the original 5 meeting days suspension, and thereafter another 1 year suspension with all his privileges and allowances stripped of if he refused to apologise to the SSA at the end of the 6 month suspension.)

(DAP’s Teng slapped with six-month suspension, Malaysiakini.com, 1 August 2005)

http://www.malaysiakini.com/news/38501

(DAP Central Working Committee Resolution, 3 August 2005)

	http://www.dapmalaysia.org/all-archive/English/2005/Aug05/bul/bul2786.htm

36.	At the end of the day, as things stand today, only the people could punish such undemocratic actions of the State Speaker through the ballot box. It is not up to the Court to question his actions.

37.	Indeed, after what happened in Selangor in 2005 and in Perak in March 2009, for the benefit of both the current Ruling Regimes and the Oppositions, there is a strong case to be made that our Federal and State Constitutions should be amended to stipulate that under no circumstances should a Member of Parliament or State Assembly be suspended from attending any sitting of the Legislature. (Perhaps with the only exception being that those who are guilty of violent or intimidating physical conduct should be suspended briefly for emotions to calm down (so that we do not become like the Legislative Assembly of Taiwan or South Korea), such as what happened in the Kelantan State Legislative Assembly in November 2007 when Datuk Nozula Mat Diah (BN–Paloh) challenged Mohd Zaki Ibrahim (PAS–Kelaboran) to a fist fight.)

(Near brawl at Assembly; The Star, Tuesday, November 27, 2007.)

http://thestar.com.my/news/story.asp?file=/2007/11/27/nation/19585197&sec=nation

38.	This is because by denying a Member the right to attend/speak is tantamount to denying the people represented by that Member the right to attend/speak. However unpopular, unwelcomed or non-mainstream is the Member’s opinion, s/he should never be denied the right to attend/speak because it is precisely a fundamental tenet of democracy and freedom that even the minority of 1 should not be denied the right to persuade the Assembly – and the people as a whole, by extension – to agree with his/her views. Otherwise, it defeats the whole purpose of having any legislative meeting and the Legislature would become a mere rubber-stamp.

39.	A Member might be behaving inappropriately during the Assembly, such as making racist or sexist comments or simply by being drunk, but it is my humble opinion that a rude, obnoxious, ‘kurang ajar’, uncivilized or disrespectful Member should still not be suspended because ultimately, s/he shall be judged and shamed by the public opinion and be penalized in the ballot box for his/her antics. If however the people of his/her constituency still decide re-elect a ‘savage’ to represent them in the next election, then I suppose they deserve whom they elect, and may God helps us all.

40.	Be that as it may, as our democratic system and the law stands now, however wrong the Speaker might have been, it is still not open for the Court to question the validity of his actions. The sovereignty and privileges of the Legislature as enshrined in the Federal Constitution must be respected, or else we would have chaos and a constitutional crisis – just like in Perak right now.

Appendix – Why the Government Proceedings Act 1956 was enacted as law?

41.	Lawyers and laymen alike tend not to be fully aware about just how important the GPA is. The GPA is one of the statutes which could be said to be of ‘constitutional’ importance. It protects our fundamental rights (especially the right to private property) as citizens against our governments, and hence upholds the rule of law.

42.	To understand why the GPA was passed, we can refer to the case law on the English Crown Proceedings Act 1947 (“CPA”), because the GPA was modeled on the CPA. Briefly stated, the CPA was passed to make it possible for an ordinary citizen to sue the Government for private law wrong (such as breach of contract or tort of negligence) just like suing another fellow citizen. (As opposed to suing the Government for public law wrong, by seeking prerogative orders in Judicial Review proceedings.)

43.	Before the CPA, a citizen of England was unable to sue the British Government directly for private wrongs. The Government (or ‘Crown’) was considered as ‘above the law’ in that sense, because of the feudal myth that “the Crown could do no wrong”.

44.	However, this did not mean that the citizen had no remedy in law at that time. The citizen could still ‘sue’ the Government for private law wrong (except tort) by a cumbersome procedure called the ‘Petition of Right’. This was considered highly unsatisfactory. Therefore, reforms were carried out to make it easier and possible for an ordinary citizen to sue the Government for private law wrong.

45.	This was confirmed by our Federal Court in Minister of Finance, Government of Sabah v Petrojasa Sdn Bhd [2008] 5 CLJ 321 @ para 70:-

“In Sabil Mulia (M) Sdn. Bhd. v. Pengarah Hospital Tengku Ampuan Rahimah & Ors [2005] 2 CLJ 122, the Court of Appeal at p. 131 stated:

We now turn to consider the position after 1948. It is axiomatic the Crown Proceedings Act 1948 was passed to improve the position of the citizen vis-a-vis his or her rights against the Crown. As Professor Wade in his article ‘Injunctive Relief against the Crown and Ministers’ [1991] 107 Lq R 4 at 6 says:

The Crown Proceedings Act 1948 was a remedial statute, designed to put the Crown, so far as it could properly be done, into the position of an ordinary litigant, so that justice could be done without obstruction by the Crown’s ancient immunities. As Lord Jauncey said in British Medical Association v. Greater Glasgow Health Board [1989] AC 1211 (where, incidentally, Lord Diplock’s Town Investment (Town Investment Ltd. v. Department of the Environment [1978] AC 359) dicta were once again disregarded), ‘the general purpose of the Crown Proceedings Act was to make it easier rather than more difficult for a subject to sue the Crown,’ and the extension of immunities would ‘run wholly counter to its spirit’.”

46.	A more detailed discussion of the history and purpose of the CPA is found in the House of Lords case of Davidson (AP) v Scottish Ministers [2005] UKHL 74, where Lord Rodger of Earlsferry said:-

“60. 	…[the Crown Proceedings Act 1947 was] an Act whose general purpose was “to make it easier rather than more difficult for a subject to sue the Crown”, as Lord Jauncey of Tullichettle observed in British Medical Association v Greater Glasgow Health Board 1989 SC (HL) 65, 95.”

62. 	The 1947 Act was passed to try to cure various problems which litigants and practitioners had been experiencing. Some 60 years later, it is not easy to see those problems as they must have appeared to people at the time… But, perhaps, as good a starting point as any is the report of the Committee on Ministers’ Powers (“the Donoughmore Committee”) (Cmd 4060) published in 1932.

64. 	… at p 112, they confessed that “under the rule of law in England the remedy of the subject against the Executive Government is less complete than the remedy of subject against subject.” They then identified three “main defects” in the subject’s remedies against the government in England: (a) that, owing to the peculiar procedure in cases in which the Crown was a litigant, the subject was to some extent placed at a disadvantage; (b) that there was no effective remedy against the Crown in the county court and (c) that the Crown was not liable to be sued in tort.

65. 	As this account shows, the committee dealt separately with Crown side proceedings and other proceedings against the Crown. The three “main defects” concerned proceedings other than Crown side proceedings. Except in relation to tort, the defects were procedural. For instance, a litigant might have a perfectly good claim in contract against the Crown but he had to proceed by the cumbersome petition of right procedure…

67. 	In the 1947 Act Parliament set out, inter alia, to remedy the three “main defects” identified by the Donoughmore Committee. Part I deals with substantive law, Part II with jurisdiction and procedure in general. Part III covers judgments and execution, while Part IV contains miscellaneous and supplemental provisions…

72. 	The defects identified by the committee concerned the way that the Crown was treated differently from its subjects in cases where it could have been expected to be subjected to the same liabilities and procedures as a subject. So, for example, if I had a contractual claim against a shopkeeper, I could sue him by a relatively straightforward procedure in the county court or sheriff court, if I wished. But if my claim was under a contract with the Crown, in England I would have to bring petition of right proceedings in the High Court, while in Scotland I could not sue in the sheriff court. In both jurisdictions the Crown was not liable for acts which would have made an individual liable in tort or delict. Since, as I explain below, liabilities between individuals can be conveniently described as private law liabilities, what the Committee were highlighting in this part of their report were problems which litigants faced in bringing liability home to the Crown in the realm of private law. What the 1947 Act did, therefore, was to complete the programme of reform, begun with the 1938 legislation on Crown side procedures, by making changes in the substance of the private law and in the procedures used to sue the Crown in relation to its private law liabilities. In the words of a contemporary author, “On 1 January 1948, with the commencement of the Crown Proceedings Act 1947, there started a new era in Crown law. The subject has been given a remedy as of right against the Crown, both in tort and in contract, and the procedure governing litigation between subjects has, so far as possible, been applied to civil proceedings by and against the Crown”: R McMillan Bell, Crown Proceedings (1948), p iii.

73. Reform of the private law and its procedures in respect of the Crown was no insignificant matter. By concentrating on judicial review, lawyers and judges today may tend to forget the historical importance of the law of tort or delict as a way of vindicating the subject’s rights and freedoms.”

47.	Clearly, the House of Lords in Davidson had made a very clear distinction between ‘public’ and ‘private’ laws when discussing the CPA. The CPA was only enacted to reform the private law obligations of the Government and did not deal with the public law obligations of the Government (in Judicial Review proceedings). Therefore, to apply the GPA to a Judicial Review proceedings in the way that the Ipoh High Court seemed to have done clearly shows that the Judge and the lawyers did not fully comprehend what the GPA was all about.

                This entry was posted on Tuesday, 10 March 2009, 12:11 am and is filed under
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AG, IGP ‘cleared’ in black-eye case

by Rahmah Ghazali and S Pathmawathy

Mar 11, 09

Malaysiakini

Attorney-general Abdul Gani Patail and inspector-general of police Musa Hassan have both been cleared of any criminal involvement in Opposition Leader Anwar Ibrahim’s black-eye case, according to the Minister in the Prime Minister’s Department Mohd Nazri Abdul Aziz.

He was replying to Gobind Singh-Deo (DAP-Puchong) as to why no action has been taken by the authorities after Anwar had lodged reports with the police and the then Anti-Corruption Agency (ACA) last July.

Subsequently, the ACA – now called the Malaysian Anti-Corruption Commission – set up an independent panel to probe the case.

The panel members were Kadir Sulaiman, Wira Mohd Nor and Ahmad Nor Abdullah – all former judges from the Federal Court and Court of Appeal.

According to Nazri, the investigation by the panel began on July 2 last year.

“The investigation was completed two months later as it was considered a sensitive and high-profile case,” he said.

“After a detailed investigation, they found the AG and the IGP did not commit any wrongdoing relating to the case as alleged by Anwar.”

He further said that each of the panel members had to probe the issue independently in order to draw their own conclusion on the matter.

However, several opposition MPs were not convinced by the minister’s answer, stressing that there had been no information on the case after the investigation was completed.

In his supplementary question, Gobind queried Nazri as to when the panel had made the decision and why there had been no disclosure on this earlier by the authorities.

“We have also not been informed whether any action has been taken against the suspects,” asserted Gobind.

One panel member found case against AG

Nazri said the authorities required “ample time to make the decision public so that it would not be doubted by some parties”.

Lim Kit Siang (DAP-Ipoh Timor) then questioned Nazri as to who had made the final decision, since the investigation had been conducted independently.

“Let’s say one of them decides that the AG is guilty. In that case, who makes the final decision?” asked Lim.

Nazri explained that the decision was made based on the majority view, and in this case, all three members had found no case against the IGP, and only one had found a case against the AG.

He however refused to divulge further details.

Later at a press conference, Anwar, who is also de facto leader of PKR, said it was typical of the government to “manipulate” the facts adduced to the MACC.

“It is not easy to bring a case against those two without evidence, and it also depends on what has been submitted,” said Anwar.

He further accused Nazri of using the Parliament as a place to “defend the case” as the latter chose to reply in the House this morning.

Anwar: I’m disgusted

Anwar said he was “disgusted” with the finding and said the government did not provide full details of his complaint to the investigating panel.

“I believe there is a cover-up because it involves the VVIPs.

I am disgusted, I think it is very unfortunate with all the evidence provided, they can brush it aside,” he told reporters at Parliament.

“It is typical of the government – you give them strong evidence, medical reports, they refuse to act and allow them to go free,” he said.

Last month, Anwar had lodged a police report claiming that the AG and the IGP were involved in a conspiracy to fabricate an arrest warrant in 1998.

Anwar had also accused Abdul Gani and Musa of fabricating evidence in an investigation into the beating he received by former police chief Abdul Rahim Noor while in police custody.

Anwar, then deputy prime minister, was arrested and jailed for corruption. A sodomy conviction was later overturned on appeal.

The oppposition leader had said the involvement of Abdul Gani and Musa was further affirmed by a defamation suit against him last October by Mat Zain Ibrahim, the investigating officer who probed the ‘black eye’ incident.

Mat Zain had stated that Abdul Gani, who was then a senior deputy public prosecutor, delayed the investigation process and concealed facts from then AG, the late Mohtar Abdullah.

Musa was the investigating officer into previous cases against Anwar, where the former DPM was accused of abuse of power, corruption and sodomy.

Police report last July

In his police report last July, Anwar had alleged: “I believe Musa and Abdul Gani were present in Bukit Aman on Sept 20, 1998 and knew about the assault by Rahim Noor on me.

“Musa and Abdul Gani further concealed the fact of the assault on me from the public until my black eye and injuries were revealed in court.

“I believe both Musa and Abdul Gani were actively involved in the procuring of the second undated (medical) report by Dr (Abdul) Rahman (Yusof) which makes false and incredible conclusions (regarding his injury).

“They gave instructions to Dr Rahman to proceed to write this second report and were acting under the direction and/or jointly with Mohtar.

“These facts show that Musa, Abdul Gani and Mat Zain (who, according to Dr Rahman’s second report, accompanied him to the cell in Bukit Aman where I was detained and participated in the so-called reconstruction of the scene) conspired with Dr Rahman to procure the production of this second report.

“This was done so that my police report of Sept 27, 1998, in respect of the assault would be regarded as a false police report for which I could be charged, or at the very least, to damage my credibility, so as to affect my defence in the other criminal cases where I was charged for so-called corruption and sodomy to facilitate a conviction.”

                This entry was posted on Wednesday, 11 March 2009, 6:58 pm and is filed under
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Najib knows best

Najib knows best

With the announcement of a huge stimulus package, Malaysia’s next leader shows that he’s no economic reformer..

Asian Wall Street Journal

11.3.09

The man slated to take over Malaysia’s government later this month hasn’t said much about his economic philosophy. But with the announcement of a 60 ringgit ($16 billion) stimulus package yesterday, one thing is clear: Najib Razak is no free-market reformer.

Mr. Najib, who is currently deputy prime minister, called yesterday’s package “unprecedented in the nation’s history.” For an expenditure of roughly 9% of 2008’s GDP over two years, that’s no exaggeration. Malaysia will raise debt to fund this largesse. The fiscal deficit is now projected to reach a whopping 7.6% of GDP, up from 4.8%.

Malaysia is following in the fiscal footsteps of the U.S., Australia and Japan, but that doesn’t make it smart. The “stimulus” from all this spending will likely be limited. Most of the money will be spent on loan guarantees, infrastructure and public-sector expansion, rather than on tax cuts that could stimulate productive growth. State-owned investment company Khazanah, for instance, will be handed 10 billion ringgit. Pet projects such as “green investments” and the state-run auto maker will also see cash handouts. The government itself will hire 63,000 workers.

This is effectively a restatement of Malaysia’s old, government-knows-best policies. It’s the opposite of what Malaysia really needs, which is to ditch this thinking and shift to a business climate that encourages private investment and entrepreneurship. The government predicts GDP could shrink 1% this year.

Yesterday’s fiscal expansion is also a political risk for Mr. Najib and his ruling coalition. Malaysian voters, fed up with the government’s racial politics and lackluster economic growth, handed opposition parties roughly one-third of the national parliament last year and victories in two subsequent parliamentary by-elections. If Mr. Najib’s package doesn’t work, the voters may protest again at the polls.

                This entry was posted on Wednesday, 11 March 2009, 1:48 pm and is filed under
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The Pendatang joke from Penang

(This joke, which came by  email, hits home a most pertinent message about Malaysian nation-building.)

Ahmad: Hey son, who were you talking to ?

Son:   My fairy godmother.

Ahmad: How many times have I told you there is no such thing as a fairy godmother ?

Son:  I know but there really is a fairy godmother, Dad.

Ahmad:  Okay, call her here now. I would like to talk to her.

Son:  But she won’t come Dad. She said she doesn’t want to meet you.

Ahmad: Did she tell you why?

Son:  She said that you are a bad man.

         You betray your Chinese friends by calling them Pendatangs.

Ahmad: You saw that news on TV, didn’t you ?

Son:   No, I didn’t, the fairy godmother told me.

Ahmad:  Well, your fairy godmother is wrong.

             She should thank me for calling the Chinese Pendatangs.

Son:   Why Dad ?

Ahmad: You see son, the Chinese are actually bad people.

             They come from another country and they want to chase us out of

             this country.

Son:     Why do they want to do that Dad?

Ahmad:  Because they are greedy.

            Now, you tell your fairy godmother that your Dad is right by doing what

            he did. Can your fairy godmother grant you wishes ?

Son:   Yes Dad, she told me so.

          She even asked me to make a wish but I didn’t know what to ask for.

Ahmad: Well, ask your fairy godmother to make all these Pendatangs to

            disappear and go back to their grandparents country of origin.

           Okay son, time for bed. No more talking to make belief fairy godmothers ,

           okay .

           Good night son.

Son: Good night Dad.

*15 minutes later*

Ahmad: SON, SON, where are you ? Where are you ?

          Huh, there you are.  I am so worried, I thought I’d never find you.

Son:  Dad, where are we….. India ? Why are we here ?

         I was talking to my fairy godmother on your wish and suddenly we are here

         in a strange place.

Ahmad: Err, what were you talking to the fairy godmother ?

Son:   *I told her, I wish all the Pendatangs would be sent back to where they

           come from*.

           *Is that Tun Dr Mahathir s/o Iskandar Kutty and

           **Uncle Samy there selling roti ????

           Dad, is this India ???  Badawi in China ….

           Najib in Acheh rebuilding the home…..

           **Khir Toyo busy tending his farm in Indonesia ….

           Syed Albar and the rest of Arab SYED’s clan riding his camel in Yemen ‘s

           Arab desert.*

*** Indonesia population increases by 18 million while Malaysia population* shrink back to 10 million in 15 minutes !!!

Those descendants with more than 3 generation remained in Malaysia .

180 years….. 6 generations : Tun Tan Cheng Lock’s  descendants.

                This entry was posted on Wednesday, 11 March 2009, 11:40 am and is filed under
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Govt studying DAP proposal to buy back North-South Expressway and end toll collection in six years

The government is studying the DAP proposal that the government buy back the North-South Expressway to end toll collection completely in six years.

In reply to my query during the winding up of the committee stage debate for the RM60 billion mini-budget, the Second Finance Minister, Tan Sri Nor Mohamad Yakcop said the government is studying the DAP proposal to return the expressway to the people.

The
proposal
, a comprehensive, practicable and creative one formulated by the DAP Ops RESTORE (Restructure Toll Rates & Equity) Team, after  consultations with legal experts, investment bankers as well as the general public, has the following features:

1)	Impose no further increase in North-South Expressway  toll rates.

2)	End toll collection after 2015 instead of 2020.

3)	Create RM14 billion savings for Malaysians from 2009-2015 – saved either (i) by Malaysians using the highway because of no further toll rate increases or (ii) in terms of compensation which would have to be paid by the Government to PLUS Expressways.

4)	Incur no additional cost for the Malaysian Government or Malaysian tax-payers

The North-South Expressway ‘buy-back” scheme,  worked out by the DAP RESTORE Team, helmed by The Chi Chang, economic adviser to DAP Secretary-General and Tony Pua, DAP MP for Petaling Jaya Utara last month, was based on the following mechanics:

1) PLUS is listed on Bursa Malaysia at a price of RM2.88 per share and a market capitalisation of RM14.4 billion (24th February).

2) The Government of Malaysia, via Khazanah owns 65% of PLUS.

3) PLUS has outstanding net debt amounting to RM8.5 billion.

The buy-back scheme calls on  the Government to take the following actions:

1. The Government should make a General Offer (GO) to acquire all minority shareholders of PLUS with a generous 15% premium at RM3.30 per share, costing RM5.25 billion thus ensuring that minority shareholders are protected.

2. The cost of acquisition, added to the RM8.5 billion net debt of PLUS will amount to RM13.75 billion.

3. This cost will be funded by issuing Malaysian Government Securities (MGS) at 3% interest (or less), costing RM413 million per annum. Total repayment will amount to RM16.2 billion over 6 years.

4. At the same time, PLUS should generate at least RM20b in net positive cashflow the 6 years to 2015 without further toll rate hikes and assuming a conservative 3% pa traffic growth.

5. Therefore by 2015, the government can completely repay the MGS and still have RM3.8 billion excess which could be used to build a better public transportation system throughout the country.

Not only will the execution of the above proposal bring joy to all Malaysians with a toll-free North South Expressway, the exercise will also have the following effects:

•	RM14 billion saved by Malaysian consumers will reduce the cost of living for the average Malaysian in times of economic difficulties we face today.

•	RM14 billion saved will also redirect expenditure to other more productive sectors of our economy by increasing domestic consumer demand.

•	The reduced toll rates and its subsequent abolition will substantially reduce the cost of doing business in Malaysia, increase logistical efficiencies and ultimately make Malaysian companies more globally competitive.

•	Best of all, the plan will stimulate demand and make available substantial funds for public infrastructure development without the Government having to increase the precarious budget deficit further.

To another query, Nor Yakcop said the government welcomes public input to the government’s study on the viability of the proposal for government buyback of the North-South Expressway to relieve the toll  burden of the government and the Malaysian public.

                This entry was posted on Thursday, 12 March 2009, 7:27 pm and is filed under
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Najib’s roll of the dice – RM60 billion economic stimulus package (2)

The Second Package: An Overview

Najib, Minister of Finance and Prime Minister in waiting and his officials have much to account for. They have continued to be in a state of denial and inaction even as the global economy was entering what the Managing Director of the IMF has termed the Great Recession.

It would appear that  Najib has finally been jolted into action. The preparation of the Second Stimulus Package appears to have been done in a rather haphazard manner with little consultation or input from the various stakeholders.

Najib must take personal responsibility and will be held accountable for what is a flawed instrument to meet the challenges confronting the nation. He has put together a Stimulus package of RM 60 billion, a package of unprecedented size in Malaysian history.

The package of measures he has revealed has been largely met by a yawn; the markets are unconvinced by the scope of the package. The KL Bursa fell by O.6 percent on the first day of trading.  That is a clear signal that the package is viewed with a large degree of disapproval.

There is considerable skepticism on several counts. First and foremost there is the question about the size of the package, considered unwieldy. Second there are concerns that the package of measures does not address the immediate impact of the recession on employment, income levels and the pain inflicted on vulnerable groups. The measures proposed are seen as having an impact only in the medium term.

There is a great imbalance in the package. Loans for businesses account for RM25 billion, or 41 per cent of the package. These will buffer downside risks to corporate earnings and help industries struggling with debts.

Expectations that the package would include measures to boost consumption like cash-vouchers or cash bonuses, which would have had an immediate effect on Malaysia’s economy are missing. A tax waiver would have also provided the most and fastest multiplier effect.

It includes a fiscal injection of RM10 billion in 2009 which will raise the government budget deficit from 4.8 per cent of gross domestic product to 7.6 per cent this year. There will be another RM5 billion injection in 2010.

The Deputy Prime Minister said however that the RM25 billion in guaranteed funds as well as the RM10 billion investments to be injected by government investment arm Khazanah Nasional were not “silver bullets” but meant to prevent Malaysia from slipping into recession.

If so, why are these funds being disbursed? Why are there no provisions for direct assistance to those being retrenchment, or those suffering a sizable drop in earnings by way of elimination of overtime, or those facing a precipitous fall in earnings because of lower commodity prices?

What the Minister has done is to skew the package to corporate interests and favoured support for INVESTMENT activities over support for PRIVATE CONSUMPTION. This is clearly a fatally flawed policy choice.

For a start it is consumption that needs sustaining and support to alleviate the pain associated with the recession. It is also clear that stimulus needs to impact on the short term: thus direct measures in support of consumption will impact positively and immediately.

On the other hand channelling resources towards investment will mean a trickling down; the investment outlays have a long gestation period; the impact will thus be felt only after a lag. This would negate the goal of delivering immediate assistance to those feeling the impact of the recession.

There is a sense that Najib has waited too long to launch the stimulus and has wasted time in pursuing political objectives like  the destabilization of the Perak Government whilst sending mixed signals to markets and thus wasting valuable time.

Tengku Razaleigh and other critics have been critical of the delay incurred in coming forth with a package. There is also the point being made about the size of the program, judged to be excessively large in the context of the weak implementation and absorptive capacity of the economy.

Other criticism have touched on the lack of a coherent and integrated overall scheme for mounting a program of reforms which are critically needed to move the Malaysian economy out of the doldrums.

An objective assessment of the proposals leaves one with the feeling that  Najib has rolled the dice and gambled on the premise that large and massive spending will somehow enable the Government to dig itself out of the hole it finds itself in.

Some analysts are willing, with some reservations, to give  Najib the benefit of the doubt. However, there are other analysts who take a more jaundiced view. According to this latter group, based on a closer examination of the package of measures, they take the view that Najib has largely put forward a package that is little more than a blatant attempt to hijack public resources and to shovel these into the laps of UMNO warlords and cronies to protect and promote his tenuous hold on UMNO. There may well be some truth to these contentions.

A sharper criticism of the measures announced is that there is no overarching policy framework to accompany the disconnected and disjointed expenditure proposals. The singular lack of a policy vision is most troubling.  Thus there is some legitimacy to the criticism that  Najib has failed to think out of the box and he has displayed a singular lack of leadership and vision.

(to be continued)

                This entry was posted on Thursday, 12 March 2009, 2:24 pm and is filed under
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Najib’s roll of the dice – RM60 billion economic stimulus package (3)

How Did WE Get Here? An Alternative View

Najib in his speech to the House briefly reviewed recent economic developments. This review was selective and must be rebutted.

Contrary to his view, the danger signals were already there in mid 2008 when the budget for the current year was presented. However, the Government remained in a state of denial and continued to assert that Malaysia would not be affected by the global meltdown.

Ministers and the Governor of Bank Negara continued in parrot fashion to mouth the mantra of the economy attaining a growth rate of 3.5% in 2009 despite mounting evidence of declining industrial production, a fall in exports, lower commodity prices, sharp falls in FDI and growing evidence of capital flight.

On the global scene alarm was being expressed and country after country was taking measures. The two Finance Ministers remained sanguine and repeatedly provided the mainstream media with sound bites indicating that Malaysia was miraculously immune from global trends. They propounded the so-called theory of immunity via the notion of “decoupling”.

Despite these protestations, which rang hollow, the markets took due note and lowered the risk ratings.  Yet, the euphoric expressions of growth continued to be mouthed relentlessly. Najib is thus stretching credibility by suggesting that it was only late in the 4th Quarter that there were “negative” developments.

The truth of the matter is that he as the Finance Minister was either asleep at the wheel or was engrossed in narrow politicking in the context of UMNO politics. The Second Finance Minister cut a sorry figure as he went about repeating like a broken record that the Malaysian economy would continue to grow; the Minister responsible for the EPU was neither heard nor seen; the Governor of Bank Negara was hamstrung  and failed to move by adjusting interest rates or by allowing a true float of the ringgit.

There was a wide gap between pronouncements and actions. The economic management team took contradictory actions. The Budget for 2009 saw an increase of RM20 billion. The Budget was promoted as “stimulative”; a further stimulus was provided by way of a package in late 2008; Value Cap was given RM5 billion with the somewhat dubious goal of supporting the stock market, how this was to sustain growth or aid those affected by the slowdown continues to remain a mystery; further resources were provided via off budget handouts.

The point to note is that there was no overall plan to counter the effects of the globally induced shock to the economy. The key thrust of the spending measures was the channeling of funds to UMNO linked entities and the various warlords. There is little evidence that funding was provided to cushion the impact on the SMEs or the laid off workers linked with a weakening economy.

It is evident that management of the economy remained on auto-pilot while it hurtled towards a cliff.  It is thus legitimate to ask if  Najib as the economic czar has displayed a degree of competence to shepherd the economy through the treacherous waters that lie ahead.

In his speech, the DPM indicated that GDP growth rate of plus 0.1 percent was recorded in the 4th Quarter. With all due respect, it must be pointed out that the growth rate appears to be somewhat inconsistent with available indicators that have shown sharp declines. It is legitimate to ask the DPM to provide a full set of macro-economic accounts in the interest of transparency.  In any event, GDP estimates are generally subject to margins of error. The probability that the economy shrunk in the 4th Quarter is high. It would thus be prudent to acknowledge that the Malaysian economy like other ASEAN and other middle income economies recorded negative growth and to base policies on a more realistic assessment.

Turning to the prospects for the current year, it should be noted that both the IMF and the World Bank have further revised their estimates of growth for the global economy – (World Bank has projected it shrinking by at least 1% this year, the IMF has stated that there will be a decline for the first time in 60 years.)

In the face of these new estimates,  Najib’s growth estimates for Malaysia for the current year are “rosy”. Exports are likely to decline more sharply than projected by him. The FDI figures cited are wishful and are not likely to be attained given the state of global financial markets, the political instability in Malaysia, the weak fundamentals, the non-competitiveness of Malaysia. More so,  Najib conveniently ignores the fact that there are sizable capital outflows from Malaysia. Were these factors taken into account, Malaysia is likely to experience a net negative capital flows.

Najib appears to lull the nation into a state of complacency. He cites FDI figures. These are not the true measure of such flows; they represent the so-called “approvals” by MITI. Many of these approvals do not mature into actual investments. Nor do these numbers take account of the capital flight that is taking place. Evidence of the size of such flight is provided by the Errors and Omissions figure in the Balance of Payments.

The DPM asserts that with the Stimulus Package in place, the economy will experience growth. He projects this in the order of +1 to -1 percent. This is somewhat of a pie in the sky view. MIER and other reputable analysts are forecasting that the economy is likely to shrink by between 3 and 5 percent.  Datuk Najib continues to be indulging in unrealistic expectations that the turnaround will occur in the second half of the year. This is inconsistent with the consensus view that the US and other industrial economies unlikely to recover until the second half of 2010.

The DPM claimed that the sums included in the First Stimulus Package have been “channeled” implying that they have been spent. The truth of the matter is that they have yet to be spent. Given the notorious track record of shortfalls in spending (particularly on construction projects handled by F Class contractors) Najib is being very optimistic. The reality is that there are serious capacity constraints.

Secondly, spending on “projects” which are nothing but “pork” for UMNO chieftains do not directly aid those most affected by the recession. A large part of the resources are “leaked” abroad via migrant worker remittances and via imports of construction materials etc.

What is clear is that there is no evidence that the RM20 billion increase injected via the 2009 Budget and the further RM 7billion via the First Stimulus has not contributed to arresting the slowdown that began in the first half of 2008.

The lesson to be drawn, yet unlearnt, is that stimulus efforts need to be carefully targeted to counter specific economic weaknesses rather than via a general sprinkling of funds across the board. A further unlearnt lesson is that stimulus efforts must be accompanied by reform measures. The singular lack of a coherent and well designed reform package is very telling and indicative of intellectual bankruptcy.

These concerns are also applicable to parts of the Second Stimulus Package now unveiled.

                This entry was posted on Thursday, 12 March 2009, 3:39 pm and is filed under
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Najib’s roll of the dice – RM60 billion economic stimulus package (4)

The Scope of the Package

The four so-called thrusts identified by  Najib are generalities. Deeper analysis of these elements indicates that these are clichés and make for good sound bites.

It is rather salient that the DMP has made no effort to formulate and present an over-arching policy framework. There is a clear and urgent need to layout policy reforms to enhance competitiveness, correct the distortions, strengthen key agencies and identify areas of future potential growth.

There appears to be a mistaken view that Malaysia can find its way out from the hole it is in by spending billions. There does not appear to be a realization that fundamental reforms are needed particularly in the area of the regulatory framework.

There is no acknowledgement of the fact that the growth environment is deeply affected by rigidities of the NEP implemented mindlessly by the “Little Napoleons” of an inefficient and corrupt bureaucracy.  Reform is imperative if Malaysia is to regain competitiveness.

In introducing the specifics of the Package,  Najib makes no mention of the fact that there is a need to unite and jointly face the challenges; he fails to acknowledge that with almost 60% of the GDP generated in the Pakatan Rakyat  governed states, the Federal Government needs to engage in efforts to work with these state Governments if it is to succeed in mounting the challenges confronting the country. Without the necessary collaboration, the efforts to achieve economic recovery will come to naught.

The DPM refers rhetorically to the fact that the the nation has faced crises in the past and expresses the view that we shall overcome the present crisis. This is not disputed but it is important that we collectively acknowledge that the crisis we currently face is a different order and scope.

The 1997 crisis was a financial crisis unlike the current one which is linked to the real sectors and to a global meltdown. Deficit spending, an exchange rate adjustment to stimulate exports and bailing out over-extended corporate entities were appropriate tools in 1997, they are not appropriate in the present context.

The country cannot hope to export itself out of the current situation. It has to focus on sustaining demand and consumption; massive investment programs are not the appropriate means either.  The DPM’s gamble is likely to fail and put the nation in greater peril.

The Minister has asserted that the sharp increase in the fiscal deficit is temporary. This claim rings hollow if account is taken of past actions. So too was the assertion at the time of the East Asia crisis but deficit spending has become a way of life as deficits are now a part of the fiscal policy of the BN Government.

Deficits have become an addiction. It is almost as if the Federal Government’s policy stance has been to spend and spend on infrastructure and expand the size and role of the public sector in the national economy.

The pattern of spending on infrastructure has three salient features. In the absence of transparent and competitive bidding procedures, projects are handed out to well- entrenched party warlords thus contributing to the cancer of corruption.

Secondly, the over-emphasis on infrastructure has meant neglect of funding for research, investment in social services, upgrading the quality of education thus lowering the capacity to compete.

A third feature is that ever growing role of the GLCs and state owned enterprises has been that SMEs and other private sector have been marginalized and not contributed to overall growth. There has been a squeezing out of these entities.

Financing of the growing and persistent public sector deficits has meant that the private sector has been denied access to resources. This coupled with the vagaries of the NEP have contributed to the lackluster investment performance of the private sector.

Returning to the assertion that the deficits will be brought into check, I call upon the DPM to indicate  how and when he envisages a return to fiscal policies that will lead to budget surpluses.

It is significant that the BN’s fiscal policy in recent years has broadly mirrored the policies of Japan’s Liberal Democratic Party in countering recessions.

Those policies were based on “stimulus” packages that emphasized infrastructure projects handed over to party stalwarts. It is these policies that accounted for the so-called “Lost Decade” experienced by the Japanese economy.

It would appear that the Treasury Mandarins and their political masters have not absorbed the lessons of such failed policies. Malaysia can ill afford similar policies driven by a myopic vision.

The DPM  remarked that fiscal stability remains an important element of policy. These soothing remarks do not cut much ice with the rating agencies that have in recent months downgraded Malaysia’s rating levels. The recent risk analysis by the Economist Intelligence Unit should be a source of some concern to policy makers. However, there is little acknowledgement in official pronouncements that any heed is being paid.

 What is also salient is the fact that there are sizable expenditures incurred by off-budget agencies together with the large but hidden contingent liabilities of the Government. These are represented by commitments to large payouts to companies owning toll road concessions, the IPPs and cost escalation clauses in the large scale projects.

The truth of the matter is that the time is approaching when domestic financial resources will be inadequate to finance the public sector’s appetite for resources.  There will inevitably be need to resort to seeking foreign financing at high interest rates as Malaysia’s ratings deteriorate . At the extreme, there is a danger that Malaysia may have no option but to run the printing presses ala the Latin American economies in the 1980s and 90s.

                This entry was posted on Thursday, 12 March 2009, 4:08 pm and is filed under
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