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Sunday, 25-Apr-2004 1:11 PM The Terengganu dilemma On Friday, 23 April 2004, Prime Minister Abdullah Ahmad Badawi handed over the post of Ketua Perhubungan Negeri Terengganu (Terengganu State Liaison Chief) to its new Menteri Besar (Chief Minister), Idris Jusoh. This makes sense. Normally, if a state is under opposition control, like Terengganu was from 20 November 1999 to 21 March 2004, the Prime Minister or Deputy Prime Minister holds that post. Since Terengganu is now back with the ruling coalition, Barisan Nasional, then the post should correctly go to its Chief Minister. In the ‘handing over’ ceremony, Abdullah said, since the ruling coalition performed so well and almost achieved a landslide victory, he has confidence that Idris would be able to handle the job. Quite an honour for Idris, is it not? Or is it? What Abdullah has done is actually drop a hot potato on Idris’ lap. There are many unresolved issues in Terengganu. If Abdullah continues holding onto the post of Terengganu State Chief, he would have to help Idris sort out all these problems. Now that he has given Idris the job, it is entirely the Chief Minister’s problem and the Prime Minister will not be under pressure to find solutions to all these problems. Is this maybe a case of the rat deserting the sinking ship? One major problem that Terengganu is facing is the Wang Ehsan or ‘goodwill money’ that Petronas has been paying these last four years while the state was under opposition control. The money was paid to Umno, not the state, and the amount Umno has siphoned out to date is about RM3.8 billion. According to the law, via an Act of Parliament, as well as according to the two agreements signed between Petronas and Terengganu, the money belongs to the state and not Umno. The Federal Government now has to decide whether to continue with the Wang Ehsan payments or revert to royalty like what it should have been and what it used to be for more than 20 years before it transformed into Wang Ehsan in 2000. Constitutionally speaking, ‘Wang Ehsan’, and payable to Umno, is illegal. It should be ‘royalty’, and payable to the state. In compliance with the law, it should revert to royalty, and the state and not Umno should become the beneficiary to the roughly RM800 million or so every year. Then the question of how to account for the RM3.8 billion that for all intents and purposes has been illegally siphoned into Umno’s coffers would need to be addressed. Should Umno Terengganu then be made to pay back the state this RM3.8 billion so as not to be in breach of Parliament? However, solving this is not as simple as amending the books and changing the classification of the payout. There is also the commitment to the voters to consider. Illegal or otherwise, Umno has been using a huge portion of this Wang Ehsan to pay RM300 Duit Raya (Eid money) to each and every Terengganu citizen. At least this is what the accounts show though many never did actually receive any cash though the books may show they did. Umno promised that if it won the recent election it would double this amount to RM600 per citizen per year. Now that it has won it will have to make good this election promise. There are roughly one million Terengganu citizens including those born in Terengganu but living or working outside the state. This means, this year, and every year thereafter, all those eligible would receive a total of RM600 million Ringgit. But Terengganu would be receiving only RM800 million a year from Petronas. And it will now be the state and not Umno that will receive the money -- unless they want to flout the law and continue with the Wang Ehsan instead of reverting to royalty. How, therefore, will Umno find the funds to service this Duit Raya unless:
Another problem Umno has to address is the financial viability of continuing with the Duit Raya payments even if they can solve the legality aspect of the whole arrangement. Terengganu needs about RM600 million a year just to run the state -- to pay salaries, service its Federal loans, etc. -- even before taking into account any development expenditure. Added to the RM600 million Duit Raya, this comes to RM1.2 billion a year. Then there are the scholarships that they are paying out, the free bicycles to every school-going child, the prizes for good performance in school, and all the other goodies that they were paying to the people while the state was under the opposition. The amount paid out every year for all these goodies is a ‘national secret’ (because much of its was ‘hijacked’) but is estimated to run into another couple of hundreds of millions Ringgit. An educated guess would put Terengganu’s commitments easily in the region of RM1.5 billion a year -- Duit Raya, salaries, loan servicing, prizes, scholarships, and all included. How does one pay RM1.5 billion from an income of only RM800 million? Abdullah said, in the hours after the election results were announced, that anything Terengganu wants it will get. All Idris needs to do is ask. Well, what Terengganu wants is for all its goodies to continue, nothing must be terminated, and the doubling of the Duit Raya as promised in the run-up to the election. When the opposition took over the state in November 1999, it abolished quit rent, a huge source of revenue for the state. Realising that it is going to be hard-pressed to balance its books, the state now wants to reinstate quit rent. In fact, it is even considering backdating this quit rent four years so that it can collect the unpaid amount while the state was under the opposition. They have been advised against backdating the quit rent four years though as the people will surely revolt so they are backdating it to just 1 January 2004 instead. But money is not the only problem the state is facing. In late 2003, PAS enacted Islamic laws for Muslims while banning gambling in the state, though liquor was still allowed but for only the non-Muslims. Umno now has to decide whether to dismantle this. If it does, then Umno would prove PAS right when it said Umno is anti-Islamic. If, however, it does not dismantle Islamic law, then Umno would be admitting PAS was right in introducing it. Either way PAS wins. Umno dismantles Islamic law; PAS wins. It does not, PAS also wins. Umno is sandwiched between a rock and a hard place. Damned if it does and damned if it does not. The Wang Ehsan and Islamic law are not the only two unresolved issues Umno cannot even begin to figure out how to resolve. There are more. For example, Terengganu has more than 1,000 registered Bumiputera (indigenous) contractors. And they have all been promised jobs galore if Umno won the state. Assuming each contractor is awarded just RM2 million worth of jobs every year, the amount of contracts required would run into billions. And RM2 million a year per contractor is peanuts. Each contractor would need at least RM5 million or RM10 million a year just to stay afloat. Where is Terengganu going to find the money to fund all these contracts? As it is now, the contractors are lining up outside the state secretariat building every day waiting for handouts. Umno promised, now Umno has won, so Umno must deliver. And, as far as the Bumiputera contractors are concerned, these handouts are their birthright and it is Umno’s duty to ensure they get these jobs. The new Terengganu State government is being closely watched. The people are monitoring what the state is going to do. Many promises have been made. Nothing has yet been delivered. Even the Wang Ehsan payments that the people were enjoying while the state was under the opposition has been temporarily suspended. And one election promise made, that quit rent will never be reinstated, is being reneged. No wonder Abdullah quickly handed the post of Terengganu state chief to Idris. Idris must certainly not be envied as he is losing much sleep trying to figure how to get out of his predicament. And will gambling now again be allowed in Terengganu? Umno did, after all, accuse PAS of denying the people their rights by banning gambling. And, if gambling is now allowed, again, how will the people view this? Proof that Umno is against Islam? I am glad I am not the new Chief Minister of Terengganu.
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