By G. Manimaran - The Malaysian Insider
KUALA TERENGGANU, March 19 — Tengku Razaleigh Hamzah charged that the federal government’s goodwill payment has led to graft and power abuse, saying RM20 billion of Terengganu’s petro-dollars was spent although approved payments amounted to only RM1.6 billion in the last five years.
The founding chairman of Petronas last night stuck to his claims that the oil-producing states should get direct five per cent oil royalties rather than goodwill payments made by Putrajaya agencies, which he said were prone to abuse.
“I’ve heard that the current Terengganu government doesn’t want to take (the payment) as they can’t accept the accounts of how the money was spent five years ago.
“Because there were lots of abuses... build that, build this. Everything collapses, nothing remained standing,” the Umno veteran told a dialogue in Kuala Terengganu, referring to a string of government building collapses including a stadium.
The Terengganu government used to receive its five per cent royalty from national oil firm Petronas, from 1978 until when PAS captured the state in the 1999 elections. The royalty was then converted to goodwill payments, until Putrajaya agreed to revert to oil royalty payments in 2009, five years after Barisan Nasional retook the state.
Kelantan is insisting on the five per cent oil royalty, amounting to RM2 billion, but Putrajaya says it was not eligible as oil and gas was extracted beyond the three nautical miles that was the state’s territorial limits, but agreed to goodwill payments — similar to Terengganu’s — amounting to RM25 million.
The Kelantan prince has joined the fight for the state’s right to the payments, saying goodwill payments were unlawful and prone to abuse.
“We have to remember that with a lot of money, it can be used for corruption, a lot of things are priced higher to steal the money... that is what is called goodwill payments,” he told the Premier Dialogue on Oil Royalty at the Terengganu Equestrian Resort here.
Some 4,000 people crowded the 1,000-capacity hall for the dialogue, jointly organised by two groups seeking the return of oil royalties for both states.
Among those at the hall were PAS secretary-general Datuk Mustafa Ali, and Kelantan executive councillor Datuk Husam Musa, who leads a special state committee on oil royalty.
Tengku Razaleigh, who had spoken on the issue in Kelantan capital Kota Baru last Jan 28, touched on similar themes, saying goodwill payments might not follow procedures and cause leakages.
“Because there are leakages, there is corruption, abuse of power and such. In the end, the people end up with nothing,” said the Gua Musang Umno division chief popularly known as Ku Li.
Ku Li’s stand has put him at odds with his party, which initially chastised him but has taken to treating him royally for fear he might defect to political foes, Pakatan Rakyat, and provide leadership if de facto leader Datuk Seri Anwar Ibrahim is jailed for sodomy.
He also spoke about the differences between oil royalty and the goodwill payment offered by Putrajaya, noting the people were ready to accept direct payments of between RM200 and RM300 when they were entitled to more.
The Umno leader then revealed that the government had approved RM1.6 billion out of RM2.9 billion in goodwill payments in the past five years for Terengganu ,although some RM20 billion was actually spent. He did not give further details.
Tengku Razaleigh was questioned about his support for Kelantan’s campaign to get the oil royalty, as he had not done so when Terengganu faced a similar issue in 2000, but PAS officials came to his rescue.
Mustafa said the prince had played the same role in 2000 when he offered to be the state’s witness in its suit to regain the oil royalty from Putrajaya.
But he said the court declined Tengku Razaleigh as a witness.
To another question, Ku Li said he was puzzled with the government’s stand to link the Emergency Ordinance and the Petroleum Development Act 1974, but said the later law would supersede any ordinances.
“From what I understand, the ordinance was made in 1966, 1966 is earlier than 1974 when the Petroleum Development Act was approved by Parliament.
“Even if the ordinance was made after 1974, it cannot be superior to the Act made in 1974,” he added.
He also slammed Putrajaya for putting out newspaper advertisements to claim he was inconsistent in his stand over the oil royalty issue.
“Apparently it was a different talk then, it’s different talk now. The inconsistent ones are them, not me. I am still saying what I said then.
“I am trying to defend the law. I am here today to explain the law,” Ku Li said in his speech, adding the law was clear that oil-producing states were entitled to oil royalty or “cash payments”.
“The matter should not arise any more but it is still an issue,” he said when answering questions.
Asked for steps beyond the dialogue, Tengku Razaleigh said he had informed Husam that the issue can only be resolved if the prime minister himself admitted to getting wrong advice.
Otherwise, the state government will have to find a middleman to help change the status quo.
“I have said I can be the middleman for the state government — any state government, not just Kelantan — for free... for the federal government to solve the matter.
“If they are afraid that the money will be abused for politics or anything else, I am willing to be the middleman to ensure the benefit is for the people.
“That is one way. The other way is the interpretation of the law... like Perak, see what has happened, many interpretations,” he noted, saying it was up to the state government to decide its future moves.
Tengku Razaleigh said the best way was to use a middleman to convince both sides to follow current provisions or to go for arbitration.
“Otherwise, there is always war,” he joked.
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