MPSP financial scandal: Report ready in 2 weeks

A report on the ‘mystery' behind the insolvency of the Seberang Perai Municipal Council (MPSP) will be completed in two weeks' time, said state financial officer Supiah Md Yusof today.

Supiah, who has been appointed as MPSP acting president in place of on-leave president Farizan Darus, has been given the task by the Penang government to prepare the report.

"It is a daunting task," admitted Supiah today, adding that she was up to the task to prepare the report for the state executive council's perusal.

"Two weeks shall be enough to check the documents and finalise the report," she told journalists today. Earlier she was sworn in as the embattled council's acting president in Bandar Perda, Bukit Mertajam.

Supiah main task will be to look into the reasons for the sharp fall in MPSP reserves from RM225.021 million to RM6.45 million from 2000 to 2008.

Chief Minister Lim Guan Eng likened the 'disappearance' of the RM225 million from MPSP reserves as that of a David Copperfield magic show, "as if the funds were siphoned away through improper means".

Lim had tasked Supiah to look into how and for whom the money was spent.

Used up for politically motivated projects?

Initial checks revealed that RM50.3 million were allotted to Barisan Nasional state assemblypersons - 18 of them between 1999 and 2004, and 19 between 2004 and 2006.

A further RM8.6 million was also disbursed to 24 MPSP councillors in the same period to carry out constituency projects.

On annual average, an assemblyperson was allotted RM350,000 while councillors were set aside RM40,000 to carry out these projects - portrayed by critics as politically motivated projects to boost BN public ratings.

"A total RM59.017 million had been disbursed for political projects within seven years.

"We need to know why and what types of projects were carried out," said Lim at a press conference during the swearing in ceremony.

The projects were eventually stopped in 2007 when MPSP's accumulated fund dried up.

Officially another RM84.3 million was spent to build the MPSP's new headquarters in Bandar Perda in Bukit Mertajam, even though at the time the new MPSP building could have been built for mere RM30 million on its own land in Ampang Jajar in Seberang Perai Utara district.

A surplus budget this year

A former councillor revealed that some RM100 million was spent to purchase the land from Bandar Perda developer, Syarikat Aseania Development Sdn Bhd, to build the building and refurbish it.

The ex-councillor further said MPSP was compelled by former Chief Minister Dr Koh Tsu Koon's government to change its original plan, even though councillors had opposed the costly idea.

"I would not be surprised if the financial officer (Supiah) finds an official letter from Koh issuing directives to MPSP to move the new headquarters to Bandar Perda," said the ex-councillor.

Lim was also curious to know why the new headquarters project was awarded to Aseania Development - owned by a local Umno leader - under a closed tender process, not an open one.

Another issue was MPSP'S RM800,000 yearly contract given to Aseania Linear District Cooling System Sdn Bhd for air-condition maintenance.

Since 2000 until this year, MPSP has worked on a deficit budget, totalling RM248.395 million in eight years, including RM19.542 million deficit for this year's budget.

However, stringent cost-cutting measures this year saw the council managing to turn around its fiscal performance to show a RM11.33 million surplus with a RM130.2 million revenue over RM118.87 million expenditure as of Nov 30.

The state government plans to use Supiah's findings as basis to hire a private independent auditor to probe and produce a comprehensive report on the whole MPSP financial saga.

Lim also did not rule out engaging the police and anti-corruption agency to investigate the alleged misappropriation of the council's public funds.

He also hinted that the state government may also file civil suits against any individuals to recover the lost money.