News that French police had specifically zoomed in on documents related to Malaysia’s purchase of two Scorpene submarines when they raided the offices of arms-makers DCNS and Thales is unlikely to escape the notice of Prime Minister Najib Razak, his minders or his foes.
“It is a real warning not just for Najib but also his party Umno and Malaysians as a whole,” PKR vice president Sivarasa Rasiah told
Malaysia Chronicle.
“So far his administration has been trying to sweep the whole issue under the carpet and blaming the opposition for playing it up. But it is now clear that other people – the French authorities – also think there are grounds for a thorough and full probe.”
The real danger - not from France but within Umno
Najib was the defense minister who ordered the Scorpenes in 2002. He became prime minister in April 2009 and has moved to consolidate his grip on power. He has put his cousin Hishammuddin Hussein in charge of the powerful Home Ministry, which controls the police force, whilst national graft buster Malaysian Anti-Corruption Commission answers directly to him.
Nevertheless, his hold on Umno – the dominant party in the ruling BN coalition – is still shaky and he faces increasing internal challenges from powerful factional leaders and warlords coveting his chair. So far, his immediate predecessor Abdullah Badawi has refrained from putting him down publicly but party pundits say that doesn't mean Abdullah and his son-in-law Khairy Jamaluddin are not monitoring closely.
However, Mahathir Mohamad, who ruled Malaysia from 1981 to 2003 and has himself been widely accused of gross corruption and abuse of power, has been very vocal. Although, he has not publicly attacked Najib yet, he has made it clear that he would not hesitate to topple an 'out-of-line' Najib.
“The danger doesn't come from the French but from rivals in Umno itself. It hinges on the question of when and how would Mahathir consider Najib as out-of-line. Does it carry the same meaning for him as for the rest of Malaysia or does it just mean not following his orders?” an Umno watcher told Malaysia Chronicle.
“Given Dr M's past record, he won't be ousting Najib so that he can end corruption in Umno or Malaysia. Dr M is just waiting for the opportunity to gain further political and financial advantage, and yes, don't be surprised, he may even try to make a comeback to the top post. But he will still cover up for Najib when it is convenient and politically expedient to do so.”
Why no public probe on Perimekar, Razak Baginda
Indeed, despite public uproar and numerous street protests, the Najib administration has done little to reveal crucial details of the exorbitant deal or to implement public audits to investigate the intensifying allegations of high-level government corruption.
Although Defense Minister Ahmad Zahid Hamidi has confirmed that a whopping sum of 114 million euros or RM570 million was paid as commission for the purchase, no effort has been made to probe impropriety or to confiscate the kickback which will have to be borne by taxpayers.
The commission was paid to an obscure firm Perimekar Sdn Bhd, which is controlled by Najib’s close associate Razak Baginda,
“Why is there no action? At the very least, Perimekar, Razak Baginda and the link to Najib must be investigated. It is ridiculous that nothing is done, even now when the current Defense Minister has again confirmed there was such a sum paid to Perimekar," PKR leader Tian Chua told Malaysia Chronicle.
"Because of Najib's questionable purchase, the government spent enormous amounts on this white elephant, yet the people are the ones who will be required to bear the hardship of the subsidy cuts that his administration is now proposing. We have to accept low salaries, reduced welfare and inflation.”
Fudging the numbers
Tian, who is the Member of Parliament for Batu, was in Paris last week along with a group of top Malaysian NGOs. They had sought a meeting with the French authorities and were given the updates on the case. The French authorities confirmed that their high-profile raid conducted earlier this month was directly related to the Malaysian deal.
On Tuesday, Ahmad Zahid gave Tian a written reply to his query in Parliament of the costs of the Scorpenes. The figure revealed by Ahmad surpassed public expectations and all estimates provided by various government officials in the past.
“In the past, they tried to fudge the number and play around with the exchange rates. At first, the sum of RM1.1 billion was bandied around and then US$1.1 billion. But what we see now is RM6.7 billion, even more than the previous ballpark figure of RM5 billion,” Tian said.
According to the Defense Minister, the total costs excluding annual maintenance came up to 1.34 billion euros or about RM6.7 billion before taking into account maintenance fees. The sum broke down down to 969 million euros for the two submarines, 219 million euros for missiles, 38 million euros for miscellaneous equipment and 114 million euros for commission paid to Perimekar.
Maintenance fees were initially agreed at RM600 million for six years or RM100 million per year. However, this was later increased to RM270 million per year.
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