Too good to be true? Think twice


 

HAVE you ever grabbed an offer without any hesitation, simply because the price is too cheap to resist?

Many of us have this experience especially during sales or promotional campaigns. We tend to spend more at the end or buy things which we are uncertain of their quality when the deal seems too good to say no.

It may be harmless if the amount involved is insignificant. However, when we apply the same approach to big ticket items, it can cause vast implications.

Recently, I heard a case which reinforces this belief.

A friend shared that a property project which was selling for RM300,000 a few years ago is now stuck. Although the whole project was sold out, the developer has problem delivering the units on time.

The developer is calling all purchasers to renegotiate the liquidated and ascertained damages (LAD), a compensation for late delivery.

One of the homeowners said he is owed RM50,000 of LAD, which means the project is 1½ years late. When we chatted, we found that he purchased the unit solely due to its cheap pricing without doing much research in the first place.

The incident is a real-life example of paying too low for an item which can leave us as losers, especially when it involves huge sum of investment, such as property.

To many, buying a house maybe a once-in-a-lifetime experience, a decision made can make or break the happiness of a family.

A good decision ensures a roof over the head and a great living environment, while an imprudent move may incur long-term financial woes if the house is left uncompleted.

Nowadays, it is common to see people do research when they plan to buy a phone, household item, or other smaller ticket items.

Looking at the amount involved and implication of buying a house, we should apply the same discretion if not more.

It is always important for house buyers to study the background of a developer and project, consult experienced homeowners regarding the good and bad of a project before committing.

I have seen many people buy a house merely based on price consideration.

In fact, there are more to be deliberated when we commit for a roof over our heads. The location, project type, reputation of a developer, the workmanship, the future maintenance of the property etc, are all important factors for a good decision as they would affect the future value of a project.

Beware when a discount or a rebate sounds too good to be true, it may be just too good to be true and never materialised. If the collection or revenue of a housing project is not sufficient to fund the building cost, the developer may not be able to complete the project or deliver the house as per promised terms. At the end of the day, the “price” paid by homeowners would be far more expensive.

In general, the same principle applies elsewhere. It is a known fact that when we pay a premium for a quality product from a reliable producer, we have a peace of mind that the product could last longer and end up saving us money. Some lucky ones will end up gaining much more.

For instance, when we purchase a car, we should consider its resale value as some cars hold up well, while others collapse after a short period. Other determining factors include the specifications of the car, the after sales service, and the availability of spare parts.

Quality products always come with a higher price tag due to the research, effort, materials and services involved.

In addition to buying a house or big ticket items, other incidents that can tantamount to losing huge sums are like money games, get-rich-quick scheme, or the purchase of stolen cars or houses with caveats.

When an offer or a rebate sounds dodgy, the “good deal” can be a scam.

Years of experience tells me that when what is too good to be true, we should think twice. I always remind myself with a quote from John Ruskin (1819-1900) who was an art critic, an artist, an architect and a philosopher. “It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money – that’s all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do.

“The common law of business balance prohibits paying a little and getting a lot – it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.”

Food for thought by Alan Tong

Datuk Alan Tong has over 50 years of experience in property development. He was the world president of FIABCI International for 2005/2006 and awarded the Property Man of the Year 2010 at FIABCI Malaysia Property Award. He is also the group chairman of Bukit Kiara Properties. For feedback, please email feedback@fiabci-asiapacific.com.

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The rail economics of East Coast Rail Link (ECRL)


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Rail link seen as game changer but cost is a concern.

TOK Bali, a fishing village in Kelantan with its beautiful sandy beaches and pristine blue waters has long been a hidden gem among well-travelled backpackers. But that may soon change. The idyllic town is one that is touted to potentially become a tourist hotspot, as it sits along the alignment of the East Coast Rail Link (ECRL), a multi-billion infrastructure project that promises many economic spin-offs.

After almost a decade in planning, ECRL was launched with great pomp this week.

Touted as a key game-changer for the east coast states of Peninsular Malaysia, the interstate ECRL is expected to help the economy of the four states that it covers by an additional 1.5% per year over the next 50 years.

On a micro level, more employment opportunities, particularly skilled jobs, will be made available to Malaysians. Domestic industry players especially in the construction sector, can now anticipate construction contracts to the tune of RM16bil, at least.

   
Another milstone:Najib checking out a train model at the ground-breaking ceremony this week.He called ECRL ‘another milestore in the country’s land public transport history”.

The ECRL is expected to benefit freight transport because it would link key economic and industrial areas within the East Coast Economic Region such as the Malaysia-China Kuantan Industrial Park, Gambang Halal Park, Kertih Biopolymer Park and Tok Bali Integrated Fisheries Park to both Kuantan Port and Port Klang.

Prime Minister Datuk Seri Najib Tun Razak called it “another milestone in the country’s land public transport history”.

Despite the much highlighted economic benefits from the rail network, the venture is attracting its own share of controversies from the way the contract was awarded to the price of contract.

For one, China’s state-owned China Communications Construction Company (CCCC) has been appointed for the construction of ECRL via a direct negotiation method.

Detractors have labelled ECRL – at a cost of RM80mil per kilometre – as the world’s costliest rail project. Note that, the Gemas-Johor Baru double-tracking stretch costs RM45mil per km.

ECRL, however, will go over hilly terrain and has several tunnels to be built.

There are questions on whether the 688km rail venture, at RM55bil, will be financially feasible.

Sources say the price tag is unlikely to have included land acquisition costs.

They indicate that close to half of the land plots required for the rail link sit on private land and would require land acquisition. At this point, the total land acquisition cost is unknown.

No money in rail

The concerns of the critics are understandable, given the fact that public infrastructure projects, namely rail projects are usually not commercially viable.

A quick check on the finances of Malaysia’s very own Keretapi Tanah Melayu Bhd (KTMB) and a number of major rail operators abroad, affirms the fact that rail projects do not promise easy money.

The loss-making KTMB which was corporatised in 1992, has not been able to financially sustain itself, resulting in the deterioration of its level of service despite attempts to turn around the company.

According to the railway service operator’s latest publicly available audited report for financial year 2013, the group registered a total net loss of RM128.2mil. However, note that, the net loss had narrowed by 46% from RM238.5mil in the previous year.

Had it not been for the government’s subsidy which kept it afloat, KTMB would find it difficult to continue its operations without a further raise of its fare.

In India, where railway is a favoured mode of transportation, the Indian Railways has been incurring losses on passenger operations every year. Earlier this year, the lower chamber of the Indian parliament was told that the state-owned rail operator recorded a loss of Rs359.18bil (RM24.04bil) in the period of 2015 to 2016.

This was slightly higher than its loss of Rs334.91bil (RM22.42bil) in the period of 2014-2015.

On the other hand, China’s state-owned rail operator, China Railway Corp, was reported to have recorded a 58% increase in earnings last year despite huge losses in the first nine months. However, a zoom into its finances reveals that the high profit made was only possible due to a significant annual government subsidy.

Similarly, Singapore’s SMRT Corp which manages the city-state’s rail operations posted a profit of S$7.4mil (RM23.33mil) in its financial year of 2016. This was on the back of a revenue of S$681mil (RM2.15bil), which rose by 4.1% year-on-year.

While the rail operations saw higher ridership in that year, SMRT Corp would have registered a loss of S$9.6mil (RM30.26mil) for its rail business, if not for the net property tax refund of S$17.1mil (RM53.9mil).

Considering the lack of commercial viability in such rail projects, ECRL would ultimately require assistance from the government in ensuring smooth operations, while maintaining an affordable service for its users. This is akin a crucial trade-off, to complement the government’s move to provide an integrated transportation system in Malaysia, which is long overdue.

AmBank Group’s chief economist Anthony Dass tells StarBizWeek that for every ringgit spent on capital projects such as transportation, it generates a return or multiplier effect of around 5% to 20%.

In his estimation, he says the ECRL should create around RM50-55bil in terms of gross domestic product.

“The impact of this project to the economy will be multilevel. Impact on the respective states’ GDP and national GDP will be evident, though the magnitude of the impact on the respective states is poised to vary.

“On a longer term, once the entire project is completed, we expect strong benefits seeping into services related activities. Properties in the major towns is likely to enjoy more especially the port-connected towns, driven by logistics- and trade-related businesses.

“Other areas would benefit from the movement of tourism. As for the smaller towns, they are more likely to enjoy from the spillovers of this connectivity through movement of people commuting to work and new areas of business growth especially in areas like the small and medium businesses,” says Anthony.

High cargo projections

By the year 2040, an estimated 8 million passengers and 53 million tonnes of cargo are expected to use the ECRL service annually as the primary transport between the east coast and west coast.

By 2040, ECRL is projected to support a freight density of 19 million tonnes.

The freight cargo projections of the rail network stands in stark contrast to the total cargo volume running through the entire Malaysian railways today.

As of 2015, the entire Malaysian railways operations handled a sum of 6.21 million tons of cargo, according to a study related to the ECRL.

To note, the revenue from the operation of the venture is projected to be obtained through a transportation ratio of 30% passengers and 70% freight.

If the projections of ECRL are anything to go by, the planners are anticipating a ballistic growth in volume of cargo being moved along the tracks.

Is this realistic?

Socio Economic Research Centre executive director Lee Heng Guie remains concerned on the details of the project financing, albeit the expected trickle-down benefits of ECRL.

“While ECRL has been identified as a high impact public transport project that will connect east coast states with the west coast, especially Greater KL and Klang Valley, the high cost of RM55bil requires further justification. More clarity on the cost structure and terms and conditions of the loan is needed to ease public genuine concerns.

“It must be noted that the high costs, low profits and long gestation periods of transportation projects do not always make them financially viable. The financial viability of the ECRL would depend on the revenue generated to cover operating cash flow, including interest expenses.

“As the loan will have a seven year moratorium, the bunching of loan repayment together with interest payment will be substantial in the remaining 13 years,” he says.

Lowering cost the key

In terms of funding, 85% of the total project value of RM55bil would be to be funded by Exim Bank of China’s through a soft loan at a 3.25% interest.

The balance 15% would be financed through a sukuk programme by local banks.

There is no payment for the first seven years, and the government starts paying after the seventh year over a 13-year period.

At 3.25% interest per annum, the interest servicing bill for the project is huge.

“Hence the main challenge to this project will be to bring down cost as low as possible. The lower the cost, the lesser it would be the burden on the government’s balance sheet,” says an industry player.

Echoing a similar view, Lee noted the ERCL project loan is expected to be treated as “contingent liability” as it will be taken by Malaysia Rail Link Sdn Bhd, a special purpose vehicle owned by the Ministry of Finance.

This is also to ensure that the Federal Government will not breach the self-imposed debt to GDP ratio of 55%.

As at end-March 2017, the Federal Government’s debt stood at RM664.5bil or 50.2% of GDP.

At the end of the day, despite the concerns on the possible cost overrun in the ECRL project, proper management and efficiency in project delivery could lead to cost savings and ultimately lower overall expenditure for ECRL.

History has shown that Malaysian companies can lower the cost, especially on rail projects compared to foreign players.

In the late 1990s, a consortium of India and China state-owned companies were awarded the contract to build a double track electrified railway system from Padang Besar to Johor Baru. The cost was estimated at RM44bil and paid through crude palm oil.

However, an MMC Corp Bhd-Gamuda Bhd joint venture managed to win the job in 2003 with a RM14.3bil proposal. However this project was shelved and subsequently continued after a lull of few years.

ECRL is a seven year project to be built in stages. Many factors can come into play in that period like delay in construction and rise in material costs.

However in the bigger picture, the infrastructure venture should not merely be seen from a commercial-viable lens alone. The trickle-down benefits on the economy and the Malaysian population should also be factored into the calculations.

The lower the cost, the higher the multiplier effect.

Source: The Star by ganeshwaran kanaandgurmeet kaur

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Home locked by Penang City Council over RM468 paltry arrears of assessment


Hard lesson: After settling his assessment arrears, Chua Yung Lin, 37, finally receives the key (inside envelope) to unlock the chain used to seal up his unit at Taman Seri Hijau in Van Praagh Road, Penang. (Above) A closeup of the notice from the council pasted on the grille gate. — CHARLES MARI ASOOSAY/The Star

A SALESMAN is furious that his apartment unit was padlocked by the Penang Island City Council (MBPP) because he failed to pay two years of assessment arrears amounting to RM468.86.

A council official, however, defended the action, saying that MBPP was empowered to do so under the Local Government Act 1976 if a ratepayer failed to pay a year’s assessment.

Chua Yung Lin, 37, got the keys to the padlock when he paid up the arrears as well as the RM111.86 second half assessment for this year and a RM20 penalty in Komtar on Wednesday after a neighbour informed him a day earlier that the MBPP had sealed the unit.

But he is adamant in not unlocking the padlock himself, saying that the council should do so as its officials were the ones who locked up the unit.

“They gave me all the keys to the padlock and when I asked them if I needed to return the chain and padlock, they told me I could keep them,” Chua told reporters outside the unit at Taman Seri Hijau in Van Praagh Road, Penang, yesterday.

He lodged a police report on Wednesday to inform the police that he had settled the arrears and for his safety should he decide to unlock the place himself.

Chua, who has been renting out the unit for the past three years, said it was dangerous for MBPP to padlock the unit as there could be someone inside who would not be able to escape should there be an emergency.

“Thankfully, there was no one in the apartment as I think my tenants have gone out of town,” he added.

He claimed to have forgotten to pay the assessment because his tenants did not inform him of the bills.

Penang Gerakan vice-chairman Lee Boon Ten said MBPP had acted prematurely and could be charged with criminal negligence for sealing the gate of an occupied home.

“He only owed them a nominal amount. If someone was inside the apartment when they locked it, it would have been false imprisonment,” said Lee who was also present.

MBPP treasury revenue unit head Suhaida Kamalul Ariffin said Section 148(3) of the Local Government Act 1976 empowered the council to seal premises whose owners defaulted in a year’s assessment payment but the council usually only did so after the arrears were accumulated for two years.

“We can actually break down the door and seize the belongings inside. If we don’t do that to avoid destroying the door, we will seal the premises as an indication to the owner. This is however only carried out after we have checked to see if anyone is inside.

“Only after we are sure it is unoccupied, do we seal the premises,” she said when contacted yesterday.

Suhaida also said the council pasted a notice demanding the owner to settle the arrears on the unit’s grille gate in May.

“There was no response, leading us to seal the apartment. Once payment is made, we usually give the owner the keys to the lock as it is standard procedure to let them unlock it themselves,” she said.

Source: The Star

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Rail link a huge economic boost, big news for small towns in Malaysia


 
Boom time is here for railway towns, little places that dot the route of the RM55bil East Coast Rail Link from Port Klang to Kota Baru. Not only will the link shorten travel time between the west and the underdeveloped east of the peninsula, it will also unlock huge economic potential, create thousands of jobs and bring down the country’s carbon footprint. And it could all happen sooner than expected.

KUANTAN: Exciting days are ahead for the many small towns that dot the route of the East Coast Rail Link (ECRL) from Port Klang to the Kota Baru.

A host of towns including Bentong, Mentakab, Maran, Kuantan, Cherating, Chukai, Dungun, Kuala Terengganu and Tok Bali and Kota Baru, all of which are designated as ECRL stations, are looking at boom times ahead.

The ECRL will also benefit freight transport as it will link key economic and industrial areas within the East Coast Economic Region such as the Malaysia-China Kuantan Industrial Park, Gambang Halal Park, Kertih Biopolymer Park and Tok Bali Integrated Fisheries Park to both Kuantan Port and Port Klang.

Prime Minister Datuk Seri Najib Tun Razak called it “another milestone in the country’s land public transport history”.

With its slogan of “Connecting Lives, Accelerating Growth”, Najib said the project sets the tone for an economic spin-off effect and positive social impact for the east coast states.

“The ECRL is a high impact project that will provide easy access from the Klang Valley to Pahang, Terengganu and Kelan­tan.

“The 688km rail link will be a catalyst for economic equality between the west coast and east coast as it will stimulate investments, spur commercial activity, create ample jobs, facilitate quality education and boost tourism in the states of Pahang, Terengganu and Kelantan,” he said at the ground-breaking ceremony here yesterday.

Najib also urged local contractors with capabilities and know-how to seize the opportunity to take part in the project.

“We have together with our Chinese counterpart agreed that Malaysian contractors will be involved in at least 30% of this high impact project,” Najib said.

“The viability of the ECRL is undisputed as it is estimated that 5.4 million passengers and 53 million tonnes of cargo will use the service annually by the year 2030 as the primary transport between the east coast and west coast.

“Comparatively, revenue from the operation of the ECRL project is projected to be obtained through a transportation ratio of 30% passengers and 70% freight.”

Najib said the project was long overdue as the east coast states of the peninsula had only been connected to the west coast via a network of roads, highways and woefully inadequate rail lines.

Najib also urged local contractors with capabilities and know-how to seize the opportunity to take part in the project.

“We have together with our Chinese counterpart agreed that Malaysian contractors will be involved in at least 30% of this high impact project,” Najib said.

“The viability of the ECRL is undisputed as it is estimated that 5.4 million passengers and 53 million tonnes of cargo will use the service annually by the year 2030 as the primary transport between the east coast and west coast.

“Comparatively, revenue from the operation of the ECRL project is projected to be obtained through a transportation ratio of 30% passengers and 70% freight.”

Najib said the project was long overdue as the east coast states of the peninsula had only been connected to the west coast via a network of roads, highways and woefully inadequate rail lines.

The railway line, with 12 passenger-only stations, three freight stations and seven combined passenger-freight stations, is expected to increase the gross domestic product of the east coast states by 1.5%.

China’s state-owned China Communications Construction Company has been appointed for the construction of the RM55bil project.

Malaysia Rail Link Sdn Bhd is the special purpose vehicle under the Minister of Finance Incorporated tasked as the project owner.

Rail link a huge economic boost – ECRL project set to create over 80,000 jobs and promote businesses along its route

KUANTAN: The economic impact of the East Coast Rail Link (ECRL) is huge and critics who say it is not feasible are wrong.

“There will be a multiplier effect. When there are more business people, we can get more taxes and government revenue will increase,” Malaysia Rail Link (MRL) chairman Tan Sri Dr Mohd Irwan Serigar Abdullah said.

He said critics must also look at the development that would take place alongside the ECRL in the long run.

China Communications Construction Group chairman Liu Qitao said the ECRL project was of great economic significance.

“It will promote social development and improve the living standards of those along the railway line, especially in the east coast,” he said.

Liu said that the rail link was also expected to generate more than 80,000 jobs for Malay­sians during its construction period.

Another 6,000 jobs will be created during the rail’s operation and the Chinese government will also train more than 3,000 Malaysian students.

A total of 3,600 graduates will be trained in rail technology through the ECRL Industrial Skills Training (PLKI-ECRL) programme.

Its chief coordinator Prof Dr Rizalman Mamat said about 1,000 applications had already been received as of yesterday.

“The first intake of 50 participants will begin in September with the next intake of 250 scheduled in December.

The next batch of 700 trainees will be in April next year.

“The programme will be focused specifically on the socio-economic development of the east coast but this does not mean those in the west coast cannot take part.

Dr Rizalman said the training was open to graduates who majored in civil engineering, mechanical engineering and electrical engineering.

He added that Universiti Malaysia Pahang (UMP) had been appointed as the focal university for the implementation of the programme, with cooperation from Beijing Jiaotong University and Southwest Jiaotong University and other institutions of higher learning in Malaysia.

He said railway technology was developing rapidly and the programme was a stepping stone for UMP to develop rail engineering in the future.

The training under the programme will take four to six months, said Dr Rizalman.

China state councillor Wang Yong said ECRL was a landmark project for China and Malaysia.

“The team from our two sides have had productive cooperation. This is a full demonstration of the friendship between China and Malaysia and its efficiency,” said Wang.

MRL project director Yew Yow Boo said the railway would have 88.8km of viaducts mostly in Kelantan and Terengganu to bypass flood-prone areas.

Yew said the first phase would have a total length of 49km of tunnels at 19 locations with the longest being 17.9km connecting Bukit Tinggi and Gombak.

Source: The Star/ANN

Liow: Do not politicise the ECRL

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KAJANG: The East Coast Rail Link (ECRL) is created for the people and country, and should not be politicised or turned into a racial or language issue, says Transport Minister Datuk Seri Liow Tiong Lai.

“I would like to emphasise that the ECRL is one of the most important projects for the nation.

“It’s a game changer for the east coast. It is for the country’s economic development and to help us reach greater heights.

“The theme is very clear, we’re pushing for connecting lines and accelerating growth,” he said after attending Universiti Tunku Abdul Rahman’s 15th anniversary celebration at its Sungai Long campus here yesterday.

The RM55bil ECRL from Port Klang to Kota Baru, which is 534.58km long, is estimated to be completed in 2024.

Liow cautioned actions that could harm good bilateral ties between Malaysia and China were counter-productive.

 

Varsity pillars: (Standing from left to right) Utar founding president Tan Sri Dr Ng Lay Swee, MCA vice president Datuk Dr Hou Kok Chung, Dr Chuah, Dr Ling, Liow, Dr Ting, Chong and Utar Board of Trustees chairman Tan Sri Dr Sak Cheng Lum cutting Utar’s anniversary cake. 

“We must explain to the people that the ECRL is for them and the nation. They should not be misled by those out to create a controversy,” he said.

The ECRL was launched in Kuantan on Wednesday.

Certain groups had criticised the rail link launch, claiming that it was “too Chinese”.

Liow described the launch as a successful event, adding that the project was set to bring many benefits to Malaysians.

“We have received a lot of support for the project. We are looking forward to its completion,” he added.
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Local Council hoarding RM60mil in drainage funds


GEORGE TOWN: More than RM60mil collected from developers as drainage contributions in Seberang Prai has reportedly not been given to the state Drainage and Irrigation Department (DID).

Pulau Betong assemblyman Datuk Muhammad Farid Saad, who lashed out at Seberang Prai Municipal Council (MPSP) for withholding the money, said only RM2.2mil of RM63.39mil collected from 2008 to June last year was disbursed so far.

He said that according to the Auditor-General’s Report 2016, the move went against the directive which required contributions from developers to be channelled to a trust account maintained by the state DID director who would act as its controlling officer.

“MPSP’s failure to transfer the funds has resulted in many stalled flood mitigation projects.

“In 2016 alone, four places in central Seberang Prai were hit by flash floods 21 times.

“The rakyat are at the receiving end, all because MPSP wants to portray itself with a nice balance sheet.

“In the state assembly, the state government on April 2014, announced that it had increased the contributions from RM10,000 per acre to RM50,000 per acre.

“Did they spend part of the contributions on something else instead of drainage and irrigation or flood mitigation?” Muhammad Farid asked in a statement.

He said the Auditor-General also reported that MPSP’s Treasury Department was instructed to hand over RM400,000 annually to DID in 2010.

“That instruction did not get the approval from the state government. This is improper and action has to be taken.

“It is inappropriate for the local authority to make decisions behind the backs of the Chief Minister and state government.

He criticised MPSP for showing a lack of commitment in tackling floods.

“It is an irony that a local council which has won international accolades does not follow directives.

“The exposure by the Auditor-General has dented MPSP’s integrity.

“Its delay in handing over the contributions shows that it did not adhere to the state government’s CAT (competency, accountability and transparency) policy.

“Are they trying to secure another award — a local council with the healthiest coffers?”

MPSP president Datuk Rozali Mohamud said he would comment after reading Farid’s report in print.

Source: The Star

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Dubious honours: (Above) Former Penang Island City Council mayor Patahiyah Ismail with the trophy and certificate for Best Municipal Manager awards in 2013 while her Seberang Prai counterpart Maimunah (pictured here with the Chief Minister Lim Guan Eng and his aide Wong Hon Wai) received the same latter award in 2014

Penang local councils ‘fell for vanity awards scam’

GEORGE TOWN: Two European NGOs have exposed the European Business Assembly (EBA) which piled honours on Penang’s local councils as a vanity awards scam.

It is on a list of 10 organisations in Europe and China that hold elaborate ceremonies and create beautiful trophies to go with hundreds of awards.

“In many cases, those awards are bogus, sold by unscrupulous organisations that prey on hu­­man vanity,” the Center for Investigative Reporting of Serbia (CINS) and the Organised Crime and Corruption Reporting Project (OCCRP) researchers wrote in a 2014 report.

The report states that such organisations sent solicitation letters to companies and government agencies in the world, telling them that they had been nominated for various awards.

“Anyone who replies, shows interest and agrees to pay gets an award. Most of the letters contain the ceremony programme generally held in an attractive European capital, pictures of the trophies and information about costs,” the report added.

CINS was founded in 2007 by the Independent Journalists’ As­­so­­ciation of Serbia to support investigative journalism.

OCCRP comprises investigative reporters throughout Europe, Africa, Asia and Latin America.

The two local councils in Penang were left red-faced for getting EBA awards in 2013 and 2014.

The now retired Penang Island City Council (MBPP) mayor Datuk Patahiyah Ismail was awarded the Best Municipal Manager while the council was given the Best Municipality Award in 2013.

A year later, Seberang Prai Municipal Council got the Best City award while its then president Datuk Maimunah Mohd Sharif won the Best Municipal Manager award.

On Monday, it was reported that EBA was generating millions of pounds by selling fake Uni­ver­­sity of Oxford awards and cer­ti­ficates.

Pulau Betong assemblyman Da­­tuk Muhammad Farid Saad said he found many articles on­­line exposing EBA as a vanity awards organisation.

“Did they spend ratepayers’ money to get those honours? It’s like buying fake academic degrees,” he said in a statement.

Penang MCA secretary Tang Heap Seng said the state government should explain to the people whether it had purchased the awards to enhance its reputation.

In a statement, MBPP said it regretted that the awards were suspected of being false and had applied to the organiser to reaffirm the recognitions.

State Local Government Com­­mit­­tee chairman Chow Kon Yeow said he hoped both councils would be more discerning and careful in future.

Source: The Star/ANN by Tan Sin Chow

Councils: We won EBA awards after paying entry fees

Mayor: I apologise if accolade not genuine

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GEORGE TOWN: Two councils in Penang have admitted that they won the awards given by the Europe Business Assembly (EBA) without any assessment after paying a total of 7,800 euros (RM39,088) in entry fees.

Penang Island City Council (MBPP) mayor Datuk Maimunah Mohd Sharif said EBA did not send any auditor or judge to review the performances of the then Penang Municipal Council (MPPP) and Seberang Prai Municipal Council (MPSP).

“We received letters via email from EBA that we were nominated for the awards. We then corresponded on the matter.

“EBA stated their judging criteria in the letters which they would be basing their assessment on.

“As far as I know, they did not come and talk to us but assessed us (themselves),” Maimunah told reporters yesterday, adding that the MPPP and MPSP had paid £4,400 (RM20,680) and £3,400 (RM18,408.10) for the entry fees.

Maimunah, who just returned from a conference in Manila, was commenting on the EBA controversy which was reported as a vanity awards scam.

It was reported that in 2014, the Centre for Investigative Reporting of Serbia and the Organised Crime and Corruption Reporting Project researchers had exposed the EBA for giving out the awards.

“If it is true that the award is not genuine, then I apologise. I wish to stress that the local councils do not have any intention to spend taxpayers’ money to buy any award or recognition from any group,” said Maimunah.

She said at that time, both MPPP and MPSP had considered the awards as a prestigious recognition based on the assessment criteria, which included economic environment, educational infrastructure, public services and transport, recreation and entertainment.

“The entry fee is a package inclusive of the participation cost for the conference. Both of us (Patahiyah and herself) went alone and we flew economy class although we were both entitled to business class.

“We did check on the awards but we did not receive any information which would have raised suspicions.

“There are other Malaysian local authorities, agencies, universities and individuals who have received the EBA awards before us.

“As such, the councils were of the opinion that the awards ceremony were worth joining,” she said.

Both councils, she said, were still waiting for a reply from EBA to clarify the matter.

Source: The Star by Chong Kah Yuan

MPSP to participate in awards despite ‘vanity awards’ controversy

BUKIT MERTAJAM: The Seberang Perai Municipal Council (MPSP) will continue to participate in international awards despite the controversy on so-called ‘vanity awards’ received by the council from the Europe Business Assembly (EBA).

The council’s newly appointed president Datuk Rozali Mohamud said they would continue to take part in international awards, but would heed the advice of state Local Government, Traffic Management and Flood Mitigation exco Chow Kon Yeow to be more cautious.

“Up to this moment, we have decided to take part in the Wego (World e-Governments Organisation of Cities and Local Governments).

“The awards are held annually, and it is free. We do not have to pay any entry fee,” he told reporters at a press conference.

On July 24, it was reported that the EBA was generating millions of pounds by selling fake University of Oxford awards and certificates.

Researchers from two NGOs wrote in a 2014 report that such organisations sent solicitation letters to companies and government agencies in the world, telling them that they had been nominated for various awards.

“Anyone who replies, shows interest and agrees to pay gets an award,” the report stated.

The now retired Penang Island City Council (MBPP) mayor Datuk Patahiyah Ismail was awarded the Best Municipal Manager award while the council was given the Best Municipality Award in 2013.

A year later, MPSP got the Best City award while its then president Datuk Maimunah Mohd Sharif won the Best Municipal Manager award. Maimunah is now MBPP mayor.

 

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Not ready: (Clockwise from top) The front view of the Batu Ferringhi market in Penang, exposed electrical sockets and cracked floor in the badminton court, and a leaking pipe in the washroom.

 
Defects causing delay of move to RM9mil Batu Ferringhi market

The scheduled relocation of traders to the RM9mil Batu Ferringhi market on Aug 14 is postponed to a later date until shortcomings such as leakage in the washrooms and cracks on the floor are fixed.

Lim checking on the condition of the market.- Photos: ZHAFARAN NASIB/The Star

SENIOR officers of the Penang Island City Council (MBPP) were left red-faced after Chief Minister Lim Guan Eng spotted several defects in the almost completed RM9mil Batu Ferringhi market during a site visit.

Lim, who was irked with the shortcomings, asked his officers to collect back copies of his text speech given earlier to reporters.

“Before I came in, I went to the washroom. I thought it would be ready.

“But the male washroom was locked and I had to use the unoccupied ladies washroom instead.

“If the market is considered ready (by the council), then it is unacceptable,” he said.

Washroom with missing taps
A leaking pipe pipe in the washroom

It is learnt that the ladies washroom was leaking and some of the taps had yet to be fixed.

Lim, who was walking to the dining area, was stopped by several traders who requested the council delay their relocation into the market which was earlier scheduled on Aug 14.

Speaking to newsmen, Lim said another date would be set.

“We cannot fix a date now until we are satisfied that the shortcomings have been rectified,” he said.

MBPP mayor Datuk Maimunah Mohd Sharif said she would hold discussions with the market contractor and architect.

“Cracks have also appeared on the floor of the badminton courts,” she said.

Maimunah said the council had issued the Certificate of Practical Completion (CPC) for the market but not the Certificate of Completion and Compliance (CCC).

The market was scheduled for completion by the end of last year.

There are 16 hawker stalls, 28 wet and dry market units, a multipurpose hall, a library, three badminton courts, playground, bicycle path, shower rooms and 90 parking bays.

Source: The Star/ANN by Intan Amalina Mohd Ali

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