Sequel to a secret
IN JANUARY last year, police recorded statements from four politicians suspected of breaching the Official Secrets Act (OSA). The four had shown reporters a copy of the toll concession agreement for the Lebuhraya Damansara-Puchong (LDP) highway, operated by Litrak. This document, they alleged, showed that the government had guaranteed profits to concessionaires at the expense of road users.
A month later, then works minister Datuk Seri S. Samy Vellu was reported as saying the prime minister had approved in principle for all highway concession agreements to be made public.
"I had mentioned it in the cabinet on Feb 7 and the prime minister asked me to submit the working paper. Now I have already got the approval (to make the agreements public)," he was quoted as saying.
Six months later, Samy Vellu made an about-turn by saying that the government had decided it was "inappropriate" to make public the agreements it signed with highway concessionaires.
"The government has studied the matter in detail and has decided it is inappropriate to reveal the concession agreements to the public," he said in a written reply to the then Opposition Leader Lim Kit Siang (DAP-Ipoh Timur) in Parliament.
Last week, the same drama was played out in Parliament by Samy Vellu’s successor, Datuk Mohd Zin Mohamed. This time, it was argued that the government is not allowed to declassify highway concession agreements due to a confidentiality clause in the contracts. So, from the OSA, it has now become just a confidentiality clause.
"If the government reveals the concession agreements without the companies’ consent, the concessionaires can take action against the government for failing to abide by the ‘confidentiality’ provision in the agreements.
"The government’s credibility and image will also be questioned and it could affect investors’ confidence," Mohd Zin said in a written reply to Teo Nie Ching (DAP-Serdang) in Parliament.
Now we can understand why no action was taken against the four politicians. There is a clear distinction between a document classified as an "official secret" and one that is "confidential".
Nevertheless, the initial intention of the OSA was to cover only documents that "affected the country’s defence and security". But the Act was amended in 1987 to encompass any government document.
Therefore, if one was to clandestinely obtain copies of toll concession agreements, it would not constitute an offence under the OSA. The immediate questions that come to mind are: Why should such agreements have confidentiality clauses, especially those that involve public money, and more so when the public is expected to continue paying to keep them in operation?
Would our country’s defence systems or security measures be compromised if the agreements were to be made public? Would there be a catastrophe if Joe Public has access to such agreements? Would the highways collapse and become unusable if we know how much the government is paying the concessionaires?
The classification goes against the basic principles of good governance – accountability and transparency. As these agreements affect public funds and citizens’ interests, surely the people have a fundamental right to know how their funds are being utilised.
From what the four politicians discovered last year, toll charges, and compensation, do not reflect the actual cost of building – at least not the LDP. They produced documents to show the amount of cash that Litrak collects from road users after it has recouped the construction cost.
They accused the government of keeping such agreements confidential so that the public is misled into believing that at its behest, concessionaires are not increasing rates.
"For example, when signing the agreement with Litrak, the government agreed to let Litrak collect RM1.50 for cars passing through LDP’s PJ Selatan toll gate near Bandar Sunway," one of the four, Tian Chua, now an MP, was quoted as saying.
"The RM1.50 rate was to come into force from 1998 through 2006. Since there were protests, the government supposedly intervened and the toll rate was reduced to RM1, but (claimed) that Litrak has to be compensated," Chua explained.
The agreement also stipulates that Litrak is allowed to increase toll to RM2.10 from 2007 to 2015. However, it has since been increased to just RM1.60.
The key issue, however, is – the toll charges, and the compensation, do not reflect the actual cost of building the highway and the amount of cash Litrak collects from road users after it has recouped its building cost.
Litrak’s 2006 annual report showed that it recorded a net profit of RM80 million – an increase of 43% from the RM56 million in 2005.
The report also showed that Litrak collected RM243 million in revenue for its financial year ending March 31, compared to RM227 million the previous year.
It has been a profit-making venture since 2005. It started operations in 1998. With assur-ances of the concession term being extended, the shareholders can laugh all the way to the bank.
So, if this "confidentiality" clause is there to keep secret the profits concessionaires are making, it becomes an exercise in futility. In the case of listed companies, the filings with Bursa will reveal the details. In the case of private companies, a search with the Companies Commission of Malaysia will do the same.
In these circumstances, the government will look good if it serves notice on concessionaires that it wants to review the "confidentiality" clause with a view to varying it. Let’s see if those who talk about being corporate citizens practising good governance put their money where their mouths are!
By the way, if someone out there "leaks" a copy of such agreements to me, he or she will not be committing an offence under the OSA. The documents are confidential, NOT secret!
R. Nadeswaran believes there is no valid reason for keeping secret the manner in which public funds are utilised. He is deputy editor (special and investigative reporting) at theSun and can be reached at:citizen-nades@thesundaily.com
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