KUALA LUMPUR, June 11 — A bulk of debt-ridden Pembinaan PFI's funds came from a RM25 billion loan from the Employees Provident Fund (EPF), a parliamentary reply from the Finance Ministry has revealed.

According to the reply, however, the loan to the government-owned construction firm, which has reportedly racked up liabilities worth RM27.9 billion in liabilities as at end 2012, is guaranteed by government-backed land leases.

In a written reply to Shah Alam MP Khalid Samad, Finance Minister Datuk Seri Najib Razak revealed that EPF's portfolio exposure on government-linked companies up to March 31 totals RM79.99 billion and are in the form of fixed-rate loans and bonds/sukuk subscriptions backed by government and bank guarantees, and asset mortgage.

"EPF's investments in 1 Malaysia Development Berhad is limited to RM200 million, which is guaranteed by the Malaysian government.

"Meanwhile, EPF's exposure to Pembinaan PFI Sdn Bhd totals RM25.29 billion, which is guaranteed by a leaseback from the government.

"EPF does not provide any funding to Felda Global Ventures Berhad at this point," Najib said in the written reply to Khalid who had sought a list of EPF's investments in GLCs.

In March, Parliament's Public Accounts Committee (PAC) said it was satisfied with the explanation by Finance Ministry officials on how the federal government had issued bonds in the form of federal land leases through Pembinaan PFI to repay RM30 billion in loans from the country's two largest pension funds — EPF and the civil servants' pension fund Kumpulan Wang Persaraan (KWAP).

According to PAC chief Datuk Nur Jazlan Mohamed then, Treasury secretary-general Tan Sri Mohd Irwan Serigar Abdullah had explained to the PAC that Pembinaan PFI has so far utilised RM28 billion as at 2013 for public infrastructure projects, which were "generally issued through open tender".

The funds were sourced from two tranches of loans from EPF and KWAP, with the first payout of RM20 billion issued in 2006 and the second tranche of RM10 billion issued in 2012.

The loans will be repaid through bonds issued on a 15-year tenure up to 2027 for the first tranche and a 10-year tenure up to 2023 for the second tranche.

DAP's Serdang MP Dr Ong Kian Ming had previously urged the PAC to grill the Finance Ministry on RM27.9 billion in liabilities racked up as at end 2012, raising questions as to its procurement methods and its ability to repay its debts.

He also questioned why the federal government was channeling funds for development projects through Pembinaan PFI instead of using allocations from the country's annual budget, among other things.
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Dunno why is compulsary to have EPF? i knew this gonna happen to our savings and thats the reason why extend to 60 years so that EPF have enough sufficient to loan UMNO. By right increase more tax and GST?

You must trust him, he is our finance minister. We vote him for a reason remember?

You must trust him, he is our finance minister. We vote him for a reason remember?

The PFI 'investment' was speculated to be as problematic as 1MDB years ago. Just today there was an article on KWAP (not KWSP) future plans and it made me puke considering how they could give 4 billion to SRC just because of a government guarantee.

Companies like PFI are one of the ways the government keeps the debt ratio below 55%; by moving government expenditure off books to wholly-owned private entities operating via government guarantees. The worst part is they don't need parliamentary approval for their spending.

Dunno why is compulsary to have EPF? i knew this gonna happen to our savings and thats the reason why extend to 60 years so that EPF have enough sufficient to loan UMNO. By right increase more tax and GST?

why would you puke? government guarantee is as good as having no risk at all.its isn't called risk free rates for nothing. and the bulk of EPF,PNB, KWAP investment portfolios is in secured fund such as those.

I don't think SPV such as those reduced the debt ratio though  but it's good to masked expenditures though like Enron to show a "balanced budget " which will allowed them to keep a low lending rates.

states like Penang and selangor do it as well, they announced a deficit, then don't spend it then top it of and called it a surplus then do defisit again. but I'm really not sure why they do that as it's not beneficial at all outside of conning idiot fanboys though.

My next avatar!

maruah cucu lebih berharga dari kualiti hidup masa depan cucu cicit

I'm gonna get tong simen

Of course they do. The government continues to move debt off sheet by moving them to wholly-owned private entities and it does mask expenditure. Many of those entities do not appear as government debt.

The government guarantee will be invoked when an investment fails, and that guarantee is fully borne by taxpayers. It's risk-free because the entire risk is being borne by taxpayers. It's the left bailing out the right but the money has already been irresponsibly invested purely on the basis of the guarantee. The only reason so many of our local funds seem secure is because almost every one of them cannot object an order from MoF/government. You could see this at work when the local 1MDB debt/bond holders have stated they will not claim early repayment despite 1MDB triggering a cross default. There'd be no mass selling or demands for early repayment. Worst case scenario; write off the loan.

Don't be too influenced by pakatoon pseudoscience.

If it were masked by moving it off sheets and put a lot in risky situation then their debts rating will become junks as its entails risks on the part of investors and they would need to pay more interest because of it. And at 55% debts to GDP ratio it's is low, just take a peek at our southern neighbors and see if twice that numbers on a 1/6 population with no resources pose a problem.

Any government bonds is considered risk free as government hold ultimate monopoly on it's sovereign soils and not because of the tax payers. The reason Greece is in such a mess is because they lost their monetary policy which mean they can't print off money nor increase their interest rates.

The local funds aren't supposed to fight off MoF. Thats illogical MoF is their ultimate shareholders and every capitalist know that's firms exist to further the interest of their respective shareholders. And no they can't simply write off the loan as well as its consider incompetent cooperate governance and they will have problems doing their business elsewhere. Did you know ours cooperate governance are 2nd best in Asia all because of these MoF controlled funds?

The thing that need to be worried is not the sovereign backed fund which I guess is considered just to attack the premier infact the biggest risk is the premier wants to impress the public by furthering in risky investment here and abroad to get 6-8% yields.

:Perhhhh byk duit siotttt

Don't be too influenced by pakatoon pseudoscience.

If it were masked by moving it off sheets and put a lot in risky situation then their debts rating will become junks as its entails risks on the part of investors and they would need to pay more interest because of it. And at 55% debts to GDP ratio it's is low, just take a peek at our southern neighbors and see if twice that numbers on a 1/6 population with no resources pose a problem.

Any government bonds is considered risk free as government hold ultimate monopoly on it's sovereign soils and not because of the tax payers. The reason Greece is in such a mess is because they lost their monetary policy which mean they can't print off money nor increase their interest rates.

The local funds aren't supposed to fight off MoF. Thats illogical MoF is their ultimate shareholders and every capitalist know that's firms exist to further the interest of their respective shareholders. And no they can't simply write off the loan as well as its consider incompetent cooperate governance and they will have problems doing their business elsewhere. Did you know ours cooperate governance are 2nd best in Asia all because of these MoF controlled funds?

The thing that need to be worried is not the sovereign backed fund which I guess is considered just to attack the premier infact the biggest risk is the premier wants to impress the public by furthering in risky investment here and abroad to get 6-8% yields.

You must trust him, he is our finance minister. We vote him for a reason remember?

Dunno why is compulsary to have EPF? i knew this gonna happen to our savings and thats the reason why extend to 60 years so that EPF have enough sufficient to loan UMNO. By right increase more tax and GST?

And who are the investors? Local funds owned and managed by the government and not all wholly-owned entities are running commercial business. Some of them exist to carry out government projects while others manage loans/debts. LPPSA was established early this year and as I remember, it was supposed to move 40 billion of civil servants' housing loans off the balance sheet.

I'm not arguing that 55% is too high. I'm merely stating that it's lower than it actually is.

they are service oriented country with strategic location no?

Last time i heard their economy are still way stronger and stable than what it is here.

oh wait, i tot we should compare ourselves only to zimbabwe according to BeeNee supreme leader logic?

you can see our ringgit suffer when the murican hike their interest rate making them having better yield. so to say almost all of investors are local boys loyal to MOF is highly unlikely scenario.

the move of what you suspected as "moving it off balance sheets" outside of your really deep prejudices is really normal. they wanted to differentiate the loan which they had  consumed and loans for infrastructure investment to elevate investors concern. Greece problem is they consumed all of those debts for public good, by moving 40bilion of civil servants housing, 60 bil in MRT, 20 bil in KTM double tracking they can show that the loan is use for investment and will yields money despite its long break even points.

people usually defined risk not by the actual debts you have but by your overall  commitment and risk exposure. I think even being a guarantor for someone else that records is still recorded in CRIS and would count as commitments.

Dunno why is compulsary to have EPF? i knew this gonna happen to our savings and thats the reason why extend to 60 years so that EPF have enough sufficient to loan UMNO. By right increase more tax and GST?

cepat2 go take out ur EPF if not later tell you age 80 only can take out

Gion  joe_mamak info tldr n graphics for ur reading pleasure...

Putrajaya’s dodgy dealing to raise billions in secret
Kinibiz, 11 May 2015 SoS
How did a little-known company, wholly owned by the government, come to be sitting atop a RM26 billion debt pile in a matter of several years? KINIBIZ traces the strange way Putrajaya’s private finance initiative vehicle raised its billions in funding.

Billions silently spent through ‘innovative financing’
Kinibiz, 12 May 2015 SoS
A Putrajaya-owned company has quietly grown its pile of debt to RM26 billion in just six years through what is called an innovative financing method by a lawmaker. Yet little is known about what the company really does and how the money is really spent.

How Putrajaya’s PFI drive was born
Kinibiz, 13 May 2015 SoS
A mysterious endeavour with an unnerving pile of debt, Putrajaya’s private finance initiative had been uncharacteristically low-key since its introduction to the country in 2006. KINIBIZ looks back on how the initiative was begun and how the ball started rolling.

Is Pembinaan PFI funding the bumiputera agenda?
Kinibiz, 14 May 2015 SoS
Putrajaya’s private finance initiative drive had been in existence under two different prime ministers. However, tell-tale signs suggest that the special purpose financing vehicle for this initiative had morphed into a secret fund-raising machine.

Bringing Putrajaya’s PFI drive up to mark
Kinibiz, 15 May 2015 SoS
A strangely secretive endeavour with an unnerving debt pile of RM26.6 billion, Putrajaya’s private finance initiative raises many unanswered questions. However, it is not too late for the government to steer the initiative back to the light of transparency – here’s how.

btw the summary diagram from the first SoS....

btw the summary diagram from the first SoS....

Lel withdrawal at 55 oso 1 in every 4 or 5 people tak sempat enjoy their retirement money pun already go to heaven due to healthy issues...

At 60 i bet at best only 3 out of 4 people get to touch their retirement money...

later change from 60 from no need take out!

btw the summary diagram from the first SoS....