Auditing of S’wak govt agencies ‘superficial’

Some 30% of Sarawak's annual budget go into a government-approved agencies 'trust fund', information to which no one has access to.

KUCHING: A Sarawak DAP leader has expressed deep dissatisfaction over the Auditor-General’s report on Sarawak’s financial issues, describing it as “superficial”, especially with regard to the auditing of government-owned companies.

State party secretary Chong Chieng Jen said the AG’s report was a piece of “peripheral auditing” focusing on unimportant issues.

“I call the report peripheral auditing, because it is auditing on less important issues while skirting and skipping key issues of Sarawak’s financial position.

“When we look at the AG’s report, we all know for a fact that Sarawak Energy Bhd (SEB) had borrowed a sum of RM15 billion to construct dams and this RM15 billion debt loan is not mentioned in this AG’s report.

“Why? Because, they call off the balance sheet debt of the government. So the balance sheet of the state government does not contain all these debts.

“If you don’t see all these debts reflected in the report, you see a picture of good management of Sarawak government.

“SEB’s balance sheet debt, for instance, is not highlighted in the AG’s report and SEB is wholly owned by the government,” he said.

Chong said that the state annual budget had what is known as a “black hole”.

“Under our state budget every year, there is one item – government’s contribution towards government-approved agencies trust fund – which is a black hole.

“For this fund, the government sets aside every year some money. In 2007, RM1 billion was channelled into this trust fund and in 2008 and 2009 it was RM1.7 billion and RM1.8 billion respectively.

“In 2010 the government allocated RM1 billion while in 2011 the amount was RM1.3 billion, bearing in mind that Sarawak’s annual budget is around RM3 billion to RM4 billion.

“This amount [to the trust fund] represents 30% of the annual budget,” Chong said.

Billions go unaudited

He claimed that until today the Sarawak government has refused to release information or explain in the State Legislative Assembly as to where the money went.

“Is this money going to approved agencies? And what are the agencies that received this money?

“It was never disclosed. Even the Auditor-General did not dig into it and to tell us who are these agencies. They only say it is the government’s obligation towards the repayment of debts.

“That consolidates our suspicions that this amount is used to pay debts incurred by First Silicon,” he said.

First Silicon was reported to be in debts amounting to several billions of ringgit.

“The thing is that with such a substantial amount of money, the Auditor-General ought to audit who received this amount. It was not done.

“This is the largest item in the annual Sarawak state budget and yet the Auditor-General did not particularly audit on who is the recipient.

“That is why I say the AG’s report is superficial,” he said.

Chong, who is also the Kota Sentosa assemblyman, said that the Sarawak government has been boasting, saying that the energy industry is the key to the future of Sarawak economy and the main mover for this energy industry is SEB.

“Billions have been channelled to SEB for the constructions of dams. And yet the AG did not audit SEB.

“The AG should go deeper into the manner SEB has awarded some of the projects and put them in the report in order to deal with all the hanky-panky stuff in SEB.

“My question is, why didn’t the AG do it? And I believe that there must be a lot of things going on that the BN cannot afford to have SEB audited. This is pre-election auditing. It wants to paint a good picture of Sarawak.

“This is what I call peripheral auditing,” he said.