The Lavish MAVCOM –A Common GLC Problem

June 2, 2018

The Lavish MAVCOM –A Common GLC Problem

by R.

Taxpayers expect at least a semblance of practicality, pragmatism and realism when their hard-earned money is expended. People are willing to pay RM1 for peace of mind when they travel, but certainly not for fat cats to pay themselves high salaries. –R. Nadeswaran aka Citizen Nades

COMMENT | The Malaysian Aviation Commission (Mavcom) has been making headlines for all the wrong reasons. Just after the elections, AirAsia boss Tony Fernandes made a serious charge against the commission, questioning its integrity.

Fernandes claimed that the airline was pressured to cancel an additional 120 flights during the 14th General Election period. Mavcom said it viewed the claim seriously and lodged a police report against Fernandes over the allegation.

“The Commission has never issued such a directive to any airline, including AirAsia, to reduce or cancel any flight where regulatory requirements have been met,” it said.

Mavcom also said that it had commenced an investigation into the claim. “We will keep members of the public informed,” said a spokesman in a statement on May 14. A police report was also lodged.

Image result for General (Rtd) Abdullah Ahmad

How does Mavcom justify paying this retired General RM85,000 per month? He must be a management genius. The Directors must be held accountable for this irresponsible decision. Unconscionable .–Din Merican

Today, more than two weeks later, we have not been informed of the outcome of the investigation. Instead, we are told that the salary of Mavcom’s Executive Chairperson General (Rtd) Abdullah Ahmad is a whopping RM85,000 – more than four times the salary of the Prime Minister.

Image result for board of directors of malaysian aviation commission

Entrepreneur Tan Sri Tony Fernandes–A Victim of Politics. It is time we recognise his contributions to the Malaysian Economy and for building AirAsia into an award winning global brand, in stead of demonizing him. I am glad that Prime Minister Tun Dr. Mahathir Mohamad and former MITI Minister Tan Sri Rafidah Aziz have come to his defense.–Din Merican

It is also pertinent to ask when the results of the probe will be made public. It is not rocket science. Fernandes says he has the evidence to prove it. Has Mavcom requested for it – or is it too embarrassed that the cat will now be let out of the bag?

More importantly, is this kind of salary for the Mavcom executive chairperson justified? Who approved the salary? How did the board, in this instance the other commissioners, approve this? How did they conclude on the salary scale?

What is the basis for such a humongous salary? Other commissioners have to answer to the taxpayers on how they arrived at their executive chairperson’s salary. Do they actually need an executive chairperson? Why not ask the CEO to report to the board?

The Board Members are:

  • Secretary-General of the Transport Ministry Saripuddin Hj Kasim;
  • former Director-General of the Economic Planning Unit, Nik Azman Nik Abdul Majid;
  • Lawyer and Suhakam Commissioner Mah Weng Kwai;
  • former Housing and Local Government Minister Chor Chee Heung,
  • former Transport Ministry Secretary-General Long See Wool,
  • retired civil servant Fauziah binti Yaacob,
  • Deputy Chairperson of the Penang Regional Development Authority (Perda) Shaik Hussein Mydin, and
  • Nungsari Ahmad Radhi, Managing Director of Prokhas Sdn Bhd, a Ministry of Finance Inc. company.

At this juncture, it is pertinent to explain how a traveler’s RM1 is spent. According to its latest available Annual Report on its website, from March 1 to Dec 31, 2016, Mavcom incurred staff costs of RM8.7 million.

Big task ahead

It further paid RM570,000 in Directors’ Fees. Mavcom had 11 board meetings during a 10-month period. Calculated loosely, each of the eight directors earned RM5,100 for attending each of the 11 meetings. The accounts also show that RM770,000 was spent on travel and accommodation.

Image result for Anthony Loke, minister of transport

Minister of Transport Anthony Loke–Fix the MAVCOM nonsense

Mavcom is not the only one that pays its directors lavishly. The Human Resource Development Fund (HRDF) pays each of its 18 directors RM2,000 per month and a one-off tuxedo allowance of RM3,000. (The Malaysian Anti-Corruption Commission pays members of it advisory panel RM300 each for attending monthly meetings.)

HRDF’s funds come from employers who have to contribute one percent of their monthly payroll. The money is supposed to be used for the training of their respective staff but in the past, HRDF was involved in dubious diploma courses from the UK.

It also spent RM25,000 on an advertisement congratulating its then Minister Richard Riot on being conferred a ‘Datuk’ title!

Taxpayers expect at least a semblance of practicality, pragmatism and realism when their hard-earned money is expended. People are willing to pay RM1 for peace of mind when they travel, but certainly not for fat cats to pay themselves high salaries.

Similarly, employers expect their one percent levy to be used for training their own staff and not for directors to benefit at their expense.

There’s a big task ahead for the new ministers to the review unrealistic salaries, allowances and perks to organisations under their purview. Mavcom and HRDF are just two examples.

There are scores of other agencies and a review will help save the government millions of dollars. Let not history repeat itself. It was the negligence of the board that led to colossal losses in the Port Klang Authority and the Port Klang Free Zone scandals.

Also, the government-appointed directors of the National Feedlot Corporation board were oblivious to the fact that monies meant for cattle farming were used to buy luxury condos.

R NADESWARAN has been campaigning for good governance for oer 30 years and expects the new government to emphasise on its cornerstones – transparency and accountability. Comments:


6 thoughts on “The Lavish MAVCOM –A Common GLC Problem

  1. It’s a mockery of former government paying as they liked to their whims and fancies just to please these stooges of UMNO / Barisan. With this new government, it time to overhaul the system of these nonsense happening in government agencies and the private sectors. An unimaginable salary structures being drawn to these cahoots who retired from government service and the ex-ministers who failed to get elected, like Samy Velloo as an envoy to assigned to advice government at ad-hock-basis. Retired judges are given golden shakes on their retirement by giving lucrative contracts and other appointments in government. It was a mockery of the whole system that existed for many years. It is time now with the new dawn of people’s choice of government, PH must fulfill the wishes of the masses to regain the confidence.

  2. MAVCOM may not be an isolated case as such appointees who may also include retirees who are used to luxurious lifestyles at others cost may have been the standard culture for decades. Most of these appointees collected much higher remuneration packages compared to what they received when they were employed full time. Most may not even have expertise relevant to the post to which they were appointed.
    I have been raising the possibility appointees possibly being without relevant expertise and being paid high Directors’ Fees and other perks and by some holding multiple directorships including in Subsidiaries of Bursa listed companies for over a decade at AGMs but with little response that appointments are approved by shareholders and the perks in line with current practises. In the case of Federal level GLCs the quantum of fees were in line with Khazanah’s guidelines. In some cases the accumulated Fees from multiple directorships may have totalled in millions of RM annually.
    With the mandatory adoption of E-Poll system on Resolutions these were all at the discretion of 50%+1 equity owners and as GLCs are under the influence of KHAZANAH/MOF leaders the approvals are foregone conclusions. The same may be true for some listed companies where a few may own majority equity.
    Could it be a reward for past compliance to bosses directions or case of nepotism or cronyism? This may not be an isolated case.
    AUD-GEN has access to all Fed/State GLCs including their Subsidiaries and is the auditor for Govt Agencies such as Land Development Agencies [RDAs-Agriculture-FELDA-RISDA-FELCRA-etc] including Statutory and Local Authorities many of whom may also be involved in commercial/development activities via establishment of companies, it is suggested that they be visited/revisited if necessary.

    AudGen should also consider listing and making PUBLIC in the MEDIA all the past major outstanding findings of suspected cases of MISMANAGEMENT-FRAUD-CORRUPTION-COLLUSION-CRONYISM-EMBEZZLEMENT-BRIBERY-KICKBACKS-NEPOTISM involving HIGH VALUE PUBLIC FUNDED PROJECTS-PROCUREMENTS of GOODS/CONSULTANCY SERVICES. Services of retired auditors may be a valuable source to conduct such exercises. Just a suggestion.
    Gursharan Singh CMIIA – Auditor-Trainer 0192927178

    • Nowadays, i guess you’d have to apply to the glum looking Shih-Tzu Minister in MoT. But it will no longer be at the level the retired general is receiving.

  3. If you dig further, you’ll find this ‘anomaly’ in every ministry. It irks me when these retired people are given such positions. What kind of message are we sending out? There’s no other qualified person out there to do their job? What in heavens name is TS Madinah still the AG of Jabatan Audit Negara when her husband is/was DS Najib’s lucky? She was much hated when she was the KSU. Made everybody’s life difficult.

    • Patience, the Oracle had spoken that party hacks which actively participate in party politics maybe disloyal civil servants.

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