opinion

The economist views savings as deferred spending. Money stored in the form of savings is consumer spending for the future. The saver, however, views money saved as liquid security, a reserve against an unforeseen contingency.

It is comforting to have a tidy sum put aside to pay for the children's college education, a down payment on a new house or car, or perhaps a trip to Mecca. But this is true only so long as the money is deemed safe; otherwise it is a needless and nagging worry.

Savings kept at home have a negative aspect, in that they create an additional security problem, because liquid assets attract thieves. Money kept in the house lures thieves who come in the night. This poses a real threat to the entire family.

It is not uncommon that a family will be murdered by persons unknown when theft of stored money is the motive. Having a security guard on duty is no guarantee of security, as recent incidents reveal.

Ordinarily, it is safe to place saved money in a bank, either a commercial bank or a savings bank. The elaborate vaults and concrete walls of the bank protect your money until you wish to withdraw it for whatever purpose.

One sleeps well knowing that the money is safe, carefully watched over by trusted guardians specially trained for the purpose. If a prior agreement is in force, the deposited money may be used for lending out, and the fund will pay a return for temporary use of the money.

In Malaysia there is a venerable savings institution founded for the specific purpose of encouraging thrift among Muslims to enable them to perform the Haj, a pillar of Islam. Muslims regularly deposit money there, and trust the Tabung Haji officers to safeguard it. It has grown to be a large and important fund, headquartered in the capital.

The tall reactor-shaped building of the Tabung Haji is architecturally splendid, and its distinctive lines may be seen for miles. Depositors point from a distance and say, "There is where my Haj money is!"

Helpful clerks

Or was. A savings institution is not supposed to fail as a commercial enterprise might. The funds should be invested conservatively, and risk is minimised. But losses are inevitable, and usually there is sufficient collateral to recover the money which was loaned.

The Tabung Haji is nowadays in the news regularly. The fund has been named in recent activities regarding the purchase of listed stocks on the local bourse. This is unusual for a savings institution. It seems the savings funds are being used in a questionable manner for speculation.

As the share prices fall, so falls the value of the fund, necessitating the talk of another government bailout. As a continuing scheme, it is just a waste of good money attempting to rescue lost money.

It is possible that the news is already creating a sense of unease, because large withdrawals from Tabung Haji have already been made. One man, in something of a hurry, withdrew not only his own money, but also money from the accounts of all the friends he could identify, appearing at the counter an average of three times every business day for a month.

Each time he withdrew over RM100,000 in cash, hauling it across the counter and out the door with him. He did this every day for six weeks without attracting attention from the clerks at the counter. It must be assumed they were very helpful.

Withdrawals, large and small, require an identification card with picture and a thumb print. So each time he came, he provided the correct IC with picture, gave the required thumb print, signed the necessary papers, and waited patiently while the money was counted out in RM100 notes.

The smooth manner in which the withdrawals were made by an unidentified person contributes nothing to increase the feeling of security necessary for one to entrust further funds to this sacrosanct institution.

Missing money

At one time, as now, the head of the Tabung Haji was appointed by the prime minister, whose department supervises its operations. As head, the prime minister looked carefully at the qualifications of the available candidates, then chose his brother-in-law.

So the prime minister's brother-in-law is the proper person to ask on the dubious affairs at Tabung Haji. Unfortunately, he is deceased. The ACA might help in the inquiry. The prime minister is on record as having the phone number of the ACA. Apparently there has not been an official request for assistance.

Perhaps it's best to leave things to the prime minister. The public is fully convinced he will handle the case with complete confidentiality.

It would seem that the police might be helpful in discovering the whereabouts of the missing money. The recent report of the Human Rights Commission highlighted many professional failures of the police.

Recovery of the Tabung Haji money, along with the identity and prosecution of those culpable, would contribute to a restoration of lost public regard. The present public image of the Malaysian police needs improvement.

Still, they have been called in to investigate and one hopes the fund's losses will not be considered an internal affair of the Tabung Haji staff and the prime minister's department.

Continuing malfeasance

The Tabung Haji fund is huge, amounting to RM80 billion or more. When the total of the depositors accounts is greater than the total assets of the fund, there is a technical bankruptcy. If every depositor arrives to withdraw his funds, there will not be enough to go around, and the doors must be closed.

This cannot happen with the similarly strapped EPF, as more than half the money is trapped until the account holder reaches retirement age. But this is not the case with the Tabung Haji, where the accounts are demand deposits, and may be withdrawn at the request of the account holder.

The prime minister is the party responsible for Tabung Haji affairs. He appoints the officers just as he appoints his ministers. His record of appointments is not a very good one. Each time, he seems to be able to find just that one personality most suitable for the job, generally making a good face before the TV cameras of the continuing malfeasance in the handling of public property.

The prime minister has chosen new faces to correct the problems at Tabung Haji, this time selected for their knowledge and experience in fiduciary responsibilities, and hopefully more careful with the depositor's money.

The nagging question remains, 'Who has got the money?' The prime minister has not put the hounds on the trail, seemingly more concerned with mollifying public outrage than identifying the culprits and recovering the lost funds.

So a bailout could come. In the meantime, those who have money in the Tabung Haji pilgrimage fund are advised to re-evaluate the security offered by this savings institution. While the offer of a public bailout may be a comfort to some, there is nothing like having cash back in hand.

HARUN RASHID is a scientist avidly interested in the application of Islamic principles in international affairs. The promotion of goodwill through civilisational dialogue motivates his writing. His Worldview column is a personal analysis of Malaysian affairs from a global perspective.