Felda’s Freefall: A Symphony Of Billions Lost And Borrowed
With losses nearly doubling from the previous year and a staggering debt of RM8.66 billion, the future of this government-linked company hangs in the balance.
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In a move that sent shockwaves through the halls of power, the Auditor General’s explosive report on the Federal Agencies Financial Statement for 2022 was unleashed upon the Dewan Rakyat on Wednesday (March 6).
The report—now available on the National Audit Department’s website—reads like a horror story for taxpayers.
It reveals that Felda had haemorrhaged a staggering RM1 billion in losses for 2022, nearly double the gut-wrenching RM545 million losses reported just a year earlier.
But the nightmare doesn’t end there.
The report exposes Felda’s precarious position, hanging by a thread as it owes a mind-boggling RM8.66 billion to external institutions in 2022.
The Auditor General minces no words, stating that Felda has become a desperate junkie, “highly dependent on financial assistance from the government,” with RM200 million in grants in 2022 and RM342 million in 2021 as its life support.
FELDA rugi bersih lebih RM1 bilion.
— RimauXI 🇲🇾 (@RimauXI) March 7, 2024
Bekas Pengerusi FELDA dilepas & dibebas tuduhan rasuah RM3 juta. pic.twitter.com/ci4wOjuGqE
Felda’s not alone in this financial horror show.
PR1MA Corporation Malaysia (PR1MA), another government-linked entity, is drowning in red ink with a significant drop in sales of commercial properties and houses.
It recorded a loss of RM257 million in 2022 and is staring down the barrel of an RM1.75 billion loan due in October 2024.
It’s a ticking time bomb waiting to explode.
READ MORE: Ipoh Property Buyers Cry Foul, Building Name Changed To Pangsapuri
Yet another government-linked company, the Armed Forces Fund Board (LTAT), is grappling with its own demons.
Impairments in investments in 13 subsidiaries, including one of Malaysia’s oldest conglomerates, Boustead, and pharmaceutical company Pharmaniaga, have overinflated LTAT’s net profit by a staggering RM0.812 billion.
Bailout Blues: The Taxpayer’s Lament
As the nation wrestles with the fallout from these revelations, many call for a complete overhaul of the government’s approach to business.
The federal government has spent an estimated RM85 billion on bailouts for government-linked companies over the last 36 years.
Repeated bailouts and using taxpayers’ money to prop up failing government-linked companies have frustrated citizens and demanded change.
In 2018, the government had to provide an RM6.2 billion bailout to Malaysia Airlines, which had been struggling with financial losses for years.
Similarly, in 2019, the government injected RM2.7 billion into Lembaga Tabung Haji, a pilgrimage fund for Muslims, to cover its financial losses.
The auditor general’s advice to Felda to ensure the sustainability of its subsidiaries rings hollow in the face of such staggering losses and mounting debts.
In 2017, Felda Global Ventures Holdings Berhad (FGV), a subsidiary of Felda, faced a massive loss of RM1.1 billion, prompting the government to intervene and provide financial assistance.
But in a twist of fate, the government threw Felda settlers a bone by abolishing their debts last year, leaving many scratching their heads and wondering about the true cost of this billion-ringgit gamble.
Ramai masih keliru tentang isu pelupusan hutang peneroka dan hutang FELDA.
— Fahmi Fadzil 🇲🇾 (@fahmi_fadzil) July 20, 2023
Bila kerajaan tampung bayaran ni?
Saya jelaskan dengan ringkas mengenainya. pic.twitter.com/k2dYzu7r9M
It is clear that a fundamental shift in strategy is needed, one that prioritizes transparency, accountability, and the interests of the taxpayers who have been left to foot the bill for these financial debacles.
As the nation watches, the question remains: How many more billions must be squandered before the government learns its lesson and end this vicious cycle of losses and bailouts?
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