Serdang MP Ong Kian Ming has urged the government to explain a land deal for which it supposedly pays rent for land it already owns.

Ong said the Federal Lands Commission (FLC) had leased land to the Finance Ministry-owned Pembinaan PFI Sdn Bhd (PFI), which is then sub-leased back to the FLC.

The agreement purportedly involves 186 plots of FLC land located all over Malaysia.

According to Ong, the FLC is supposed to pay PFI a total of RM29.2 billion for the land over a span of 15 years, from Feb 15, 2013, until Aug 2027.

“In other words, the government is sub-leasing land that it owns by paying rental! It's like me leasing an apartment which I already own to my wife and then sub-leasing it from her by paying her rental.

“I call upon the Ministry of Finance to explain why it structured this deal where the government has to pay itself rental on land which it already owns.

“Is the purpose of this agreement to hide government expenditure from the budget so that our deficit would seem as if it is decreasing?”  Ong ( left ) asked in a statement today.

In the third series of the Auditor-General’s Report 2013, PFI had been highlighted as the government-linked company with the third largest asset holdings, worth RM27.89 billion, and ranked behind Petronas and Khazanah Nasional.

Ong had previously said that the company was set up to disburse RM20 billion under the 9th Malaysia Plan, but had not been transparent in its dealings.

“What is worrying is that the government has tried to hide this spending from the budget,” he said last Thursday, while pointing out that all of PFI’s funding came from the Employee’s Provident Fund (EPF).

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