A Kelantan statutory body had used RM1 million from a trust account for the poor for investments which later went belly-up, the Auditor-General's Report states.

Perbadanan Pembangunan Ladang Rakyat Negeri Kelantan (Ladang Rakyat) had withdrawn the funds in 2008 to invest in Rakyat BTR Capital Partners Bhd (RBTR) but recouped only eight percent of its investments.

According to the audit, the RM1 million investment was split equally between Real Estate Development Investment (Redi) and Euro Deposit Investment (Edi).

The purpose was to earn dividends in order to pay for management expenses but this contravened a directive that the funds are for monthly aid only for the poor in the Ladang Rakyat programme.

ladang rakyat, kelantan According to the audit, the investments ran into trouble in 2009 when RBTR's activities were frozen by the Companies Commisssion, following investors' complaints.

Ladang Rakyat reaped RM40,000 from Edi and RM40,947 from Redi, but it is still owed RM20,000 as bonus from Edi and RM152,510 from Redi.

"We find that the withdrawal of funds from the (Ladang Rakyat) Programme Participants' Trust Account for investment is unreasonable," the report says.

Poverty alleviation target missed

The Ladang Rakyat is a palm oil plantation programme aimed at alleviating poverty by paying participants a monthly dividend from lease collection.

Participants can also be employed at Ladang Rakyat and are given performance incentives and housing, paid for through monthly pay cuts.

However, the audit found that it had largely failed in its objectives. Among its failures are:

  • More than double the number of workers employed in the plantations are foreign workers;
  • Poor funding led to the inability to provide housing for settlers at the 1,011-hectare Limau Kasturi oil palm plantation in Gua Musang. Thus the settlers could not work there,

The oil palm trees were damaged by wildlife, resulting in production of only 0.86 tonnes of oil worth RM500, despite an investment of RM12 million.

The Limau Kasturi oil palm plantation was sold to Eastbay Ventures Sdn Bhd for RM15.5 million in March 2012;

  • Plantation companies leasing land from Ladang Rakyat make four times more or RM1.62 billion, compared with what was collected on the leases; and,
  • Some of the plantations encroach into Orang Asli traditional land.
As such, the audit suggested, Ladang Rakyat works in joint venture with commercial plantation companies instead of just leasing the lands to them, in order to reap higher returns.

It also urged the implementation of employment quotas to benefit locals and strict adherence to directives on the trust account to prevent putting the funds at risk.

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