Deputy Transport Minister Abdul Rahim Bakri has given an assurance that the government will pay what is due to the Port Klang Free Zone (PKFZ) bondholders.
“We have a commitment to the bondholders, therefore we have to fulfill it," he told the House today, when winding up matters relating to the ministry in the 10th Malaysia Plan.
He was replying Lim Kit Siang (DAP-Ipoh Timor) who had asked whether Port Klang Authority (PKA) would make any payments to PKFZ turnkey contractor Kuala Dimensi Sdn Bhd (KDSB), given the legal dispute between them.
PKA is due to pay RM723 million to the bondholders tomorrow, akthough it has taken KDSB to court for alleged overcharging.
The Internal Revenue Board (IRB), Lim noted further, has also asked PKA to pay RM328 million owed by KDSB in alleged backdated taxes.
Given such a scenario, Lim suggested that the government should consider setting up a third-party account until the dispute is resolved.
Should PKA decide to pay both parties, they would have to cough up over RM1 billion.
On the same matter, Tony Pua (DAP-Petaling Jaya Utara, centre) said PKA should not make any payments to the bondholders since it was KDSB that had raised the money to finance the PKFZ project through the issuance of bonds worth RM4.6 billion.
“PKA's obligation is not towards KDSB's bondholders,” Pua argued.
Bondholders can either individuals or companies who have invested and bought the PKFZ bond from the market.
At a press conference earlier, Pua had said that the government should hold back payments to KDSB until the court case is finalised.
"PKA can withhold payment to KDSB bondholders on the basis that KDSB had failed to complete its work. PKA could also refuse to pay IRB on the same (grounds). So if PKA says 'I do not owe money to KDSB', it is not compelled to pay the taxes owing to IRB," he explained.
'Perfect scam of the century'
If the government pays both the bondholders and the IRB, said Pua, "this would be the perfect scam of the century".
PKA will have to pay a total of RM1.05 billion to both IRB and the bondholders.
"The result will then be ... the IRB gets to collect its taxes, the bondholders get to recover their investment with interest, while KDSB escapes its obligations without having to fork out a single sen of its tax (owed to IRB)," he claimed.
He added that this will also save KDSB owner Tiong King Sing (left), who is Bintulu MP, from being sued by the IRB and bondholders.
However, the burden would then be transferred to the rakyat.
"The complete burden amounting to billions of ringgit is shifted to the hapless and helpless rakyat who will be forced to pay for the follies of the BN government," he added.
"(This would) enrich KDSB and its shareholders while those possibly guilty of criminal breach of trust such as former transport minister Chan Kong Choy (will) get away scot-free."
This PKFZ fiasco is the child of MCA. Shame!
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