RM5 billion EPF funds to ValueCap – nation-wide protest

On Monday, Deputy Prime Minister and Finance Minister Datuk Seri Najib Razak announced that the government would inject RM5 billion from the Employees Provident Fund (EPF) to double the size of the highly-secretive government fund, ValueCap Sdn Bhd to RM10 billion to prop up the stock market.

The Malaysian Trade Union Congress (MTUC) President, Syed Shahir Syed Mohamud has rightly come to the forefront to condemn the government’s move to boost up ValueCap to support the local stock market using RM5 billion from EPF, “as the provident fund is the custodian of the workers’ money and not some sort of ‘automated teller machine’ for the government”.

This is the second government attempt to raid the EPF to support ValueCap to prop up the stock market since the idea of ValueCap was first mooted by the Mahathir administration at the end of 2002 to shore up the stock market and bail out ailing companies.

In response to widespread criticism and objections that EPF funds would be involved in the ValueCap operations, the EPF on 20th November 2002 came out with a strong denial clarifying that it had not appointed ValueCap Sdn Bhd to manage the EPF’s investment fund. It also denied any EPF involvement in the KLSE to shore up the stock market.

The EPF declared:

“The EPF invests in companies with sound fundamentals, long-term growth potential and competent management. The EPF is always prudent and professional in its approach when investing members’ savings. The Fund ensures that the investments are safe, not exposed to high risks and gives reasonable returns to its members for their retirement.”

Why are EPF funds being used now to do what EPF had declared six years ago that it would not do – “The EPF’s investments are not used to bail out ailing companies”?

Why is EPF departing from its “prudent and professional approach when investing members’ savings”?

The ValueCap operations has been in existence for some six years but it had always been shrouded in secrecy, with no accountability or transparency whatsoever to Parliament or the nation, which is totally against the principles of good governance and parliamentary responsibility.

When the new government asset management company, equally owned by government agencies Khazanah Nasional Bhd, Permodalan Nasional Bhd and Kumpulan Wang Amanah Pencen commenced operations on 10th January 2003, Malaysians were told that ValueCap had started with a RM10 billion cash fund allocation.

Second Finance Minister, Tan Sri Nor Mohamed Yakcop, who was then Economic Adviser to the Prime Minister, was reported by New Straits Times of 17th January 2003 as saying that ValueCap’s three shareholders had transferred the RM10 billion to it equally “in actual cash, and not in the form of shares” when “quashing rumours that the company did not yet have the full amount available”.

Why then are Malaysians suddenly told five years later that ValueCap had only RM5 billion and not RM10 billion investment fund? Where have the balance of the RM5 billion gone to?

This is not the only instance of the totally opaque nature of ValueCap operations, avoiding accountability though managing public funds.

The Public Accounts Committee should undertake an in-depth scrutiny of the operations, management and investments of ValueCap for the past five years and table a full report before the end of the current meeting of Parliament to enable MPs to decide whether it should be allowed to raid RM5 billion from the EPF for its new tranche of operations.

EPF monies are easy government targets for bail-outs, whether for ailing companies or to recoup losses as a result of financial scandals.

The eighties provide a good example as it started the era of disastrous government intervention in the market coupled with the lack of accountability, transparency and good governance – a recipe which produced the Maminco scandal (RM600 million losses in a secretive but foolhardy and expensive foray to corner the international tin market in London), the EPF-Makuwasa scandal (multi-million ringgit EPF losses when EPF funds were hijacked unethically and illegally for stock market operations in trying to recoup losses resulting from the Maminco scandal), the RM2.5 billion Bumiputra Malaysia Finance (BMF) scandal which involved the murder in Hong Kong of a Malaysian auditor Jalil Ibrahim and the Bank Negara forex exchange market operation scandal (RM30 billion losses caused single-handedly by Nor Mohamed who was running the forex speculation operation in Bank Negara at the time).

The 12 million EPF members cannot allow their life-savings to be imperilled by stock market speculation activities using the EPF funds, which stand at some RM340 billion.

DAP will launch a nation-wide campaign to protest the RM5 billion EPF loan to ValueCap to prop up share prices and to protect the RM340 billion life savings of 12 million EPF members

The protest-cum-protection campaign will start from Ipoh next Friday and will be taken to the whole country to urge the government not to hijack the workers’ hard-earned life-savings and “coffin money” to prop up or bail out ailing companies facing bad times with a collapsing stock market with the onset of the worst global economic crisis in 80 years.

(Speech at the DAP Solidarity Dinner at Sauk, Perak on Friday, October 24, 2008)

  1. #1 by pulau_sibu on Saturday, 25 October 2008 - 8:00 am

    We are expecting more from Pakatan Rakyat and more from Anwar. It is as if Anwar is taking a rest now about taking over. The public started to get disappointed. Once taking over the power, the petrol price will drop next day. That was the promise. Now the price has dropped in the global market. Does it mean that we no longer need Anwar?

    Come on, act now, Pakatan Rakyat. What are you waiting for?

  2. #2 by All For The Road on Saturday, 25 October 2008 - 8:02 am

    It is very puzzling! Why must The EPF always come to the rescue of those in troubles without any rationale? Where is its commitment and conviction to be the custodian of the members’ and contributors’ hard-earned money? Annual dividends payout to members and contributors has been low all these years. Are their interests being looked after carefully and cautiously? We need answers from the EPF Board!

  3. #3 by kftang on Saturday, 25 October 2008 - 8:20 am

    I say, what is going on in the EPF? Is it its primary objective and priority to bail-out organizations and corporates that are in grave and deep troubles to the detriment of its contributors? The welfare of its members must be first and foremost in its minds when carrying out its duties. There must no excuse to its dereliction of duty!

  4. #4 by Elwin Heng on Saturday, 25 October 2008 - 8:32 am

    “Ask before you take!
    Take before you ask = ‘thief / robber’?”
    Show us your sincerity and mirror respect, as kindergarten pupils been well-educated these manners… !!!

    Strongly disagree and protest against unfair and irrespective motion! It was talking about our ‘coffin $’ or ‘blood-sweat $’…

    No offensive. Intend to make myself clear, why capable to order (or purchase) helicopters or tourism promotion or etc. by spending millions-or-billions… why must loan from EPF?

    Warmest regards.

  5. #5 by bennylohstocks on Saturday, 25 October 2008 - 8:52 am

  6. #6 by abunsui on Saturday, 25 October 2008 - 9:04 am

    EPF is my money.

    SIMPLE. You need my money – ASK.

    If I let you use my money = GO for it.

    If not or you never ASK – DON’t ever touch my money!!!

    That’s ROBBERY!!

  7. #7 by wtf2 on Saturday, 25 October 2008 - 9:07 am

    when the stock market falls this valuecap thingie will be beneficial to offload stocks from the cronies – you know like the way maybank pays way above market valuation for BII(?) shares. naturally the cronies get richer and the people of malaysia will basically be victims of daylight robbery And they cannot seek redress in the courts – why? someone is there to quash everything. Which by the way will be how the Mongolian murder case will end

  8. #8 by monsterball on Saturday, 25 October 2008 - 9:21 am

    Educated Malaysians know…UMNO is using EPF contributor’s funds…to gamble.
    Those highly secretive companies….is secretive..as crooks cannot expose and let even half past sixes understand…their crooked ways.
    Man in the street…contributing small amount each month .for years…to EPF…expects some securities .when they retire.
    All UMNO needs is to pass off all losses by declaring few percent less dividends…and that will cover up millions lost.
    If the losses are huge huge sum..then they go for Petronas money..to bail them out again…exactly what Mahathir did…for his son.
    But win or loose…the trustee to UMNO’s funds…will be filthy rich….exactly like a stock broker….or buy and sell houses agents.
    Anwar was right..they call in commission…to make it legal…to cheat us.
    I am the lucky one…no more EPF member…but Petronas oil.belongs to all Malaysians. So ..I am still cheated..till the day that I die…if UMNO is still in power. By paying higher price petrol…is what they do to us….for their evil deeds.
    Now they put out headlines….in S.Times..world recessions…to program us….to be prepared for the worst.
    I wonder.how many oil producing countries are going through recessions?
    I wonder…if Brunei..is effected.

  9. #9 by swipenter on Saturday, 25 October 2008 - 9:35 am

    The global financial tsunami and mother of all financial crisis is going to hit our shores sooner than we think. Just take a look at the plunging stock markets around the world and what is happening to debts laden countries of Eastern Europe, Iceland, Korea, Argentina, Pakistan etc. RM5bil is but a drop of water in the ocean and what good can it do to prop up KLCI. EPF might as well keep the RM5bil in its pocket instead of lending to ValueCap which might become value less
    capital. Like we all suspect the RM5bil would be utilised to benefit a select few counters.

  10. #10 by madmix on Saturday, 25 October 2008 - 9:59 am

    Ahyo, market collapsing, margin calls for hundreds of millions coming, investment banker calling every day. Need EPF money to prop up share price so can survive. (lament of UMNO connected koporat tycoon who pledge his shares to bank)

  11. #11 by giko on Saturday, 25 October 2008 - 10:02 am

    Can the EPF’s board of directors stop this deal?

    The board comprise (from http://www.kwsp.gov.my/index.php?ch=p2corporateinfo&pg=en_p2corporateinfo_orgstruc&ac=335 ):-

    [Board of Directors (1 June 2007 – 31 May 2009)

    Chairman: Y.Bhg. Tan Sri Samsudin Osman

    Government Representatives:
    Y.Bhg. Dato’ Ibrahim Mahaludin b. Puteh (Treasury)
    Y.Bhg. Datuk Thomas George a/l M.S. George (Human Resources Ministry)
    Y.Bhg. Tan Sri Ismail Adam (Public Services Department)
    Y.B. Datuk Amar Wilson Baya Dandot (Sarawak State Government)
    Y.Bhg. Datuk Hj. Sukarti b. Wakiman (Sabah State Government)

    Employers’ Representatives:
    Y.Bhg. Dato’ Azman Shah Harun
    Y.Bhg. Datuk Haji Ahmad Ali b. Lope Abdul Aziz
    Y.Bhg. Tan Sri Yong Poh Kon
    Tuan Haji Mahmud Mohd Nor

    Employees’ Representatives:
    Tuan Syed Shahir Syed Mohamud
    Encik Ahmad Shah Mohd Zin
    Encik Andrew Lo Kian Nyan
    Puan Chin Yung Chiew @ Rebecca

    Profesional Representatives:
    Y.Bhg. Dato’ Mohammed Azlan b. Hashim
    Y.Bhg. Profesor Datuk Dr. Ismail b. Md. Salleh
    Y.Bhg. Datuk Mohd Hashim Hassan

    Ex-Officio: Y.Bhg. Datuk Azlan Zainol]

    That’s 10 out of 17 who are not with the govt. So can they stop this OR are these 10 directors also pro-government? OR the BOD do not have a say over these matters?

    Here’s EPF’s mission statement (from http://www.kwsp.gov.my/index.php?ch=p2corporateinfo&pg=en_p2corporateinfo_geninfo&ac=1854 ):-

    [Mission and Vision

    Our Mission
    The Employees Provident Fund (EPF) is a national social security organization operating through a provident fund scheme in Malaysia. Our principal members are the private and non-pensionable public sector employees.

    We have a four-fold mission as the following:

    For the members
    Our primary mission is to provide retirement benefits to our members through the management of their savings in an efficient and reliable manner.

    For the employers
    We are committed to provide an efficient and convenient system to ensure that they meet their responsibility and moral obligations of contributing to the EPF for their employees.

    For the nation
    We are also committed towards our nation’s socio-economic development through our prudent investments.

    For the staff
    To all our employees we will provide a motivating, participating and challenging working environment which can propel them to peak performance.

    Our Vision
    To be a leading social security organisation in the world and the best government agency in Malaysia.]

    Will these keywords of “efficient”, “reliable” and “prudent” be used when making the decision to “loan” the RM5B to Valuscap?

    Will the terms of the “loan” be made public, such as the collateral, the interest rate and the length of the “loan”?

    Unc Kit, please write to the BOD of EPF to ask them to stop this deal!

  12. #12 by taiking on Saturday, 25 October 2008 - 10:12 am

    Highly secretive govt fund? You’re telling me. Heard about it. But havent got the faintest idea what is it about. Since the clowns are unwilling to be transparent they cant blame us for guessing. I say the fund is for umno and for carrying out political persecution of opposition members and for votes buying during general election and for oiling umno’s election machinery.

    Thats what i think what the fund is for.

  13. #13 by max2811 on Saturday, 25 October 2008 - 10:15 am

    The 5 billion is most probably for UMNO’s goons who got burnt in the share market. History is repeating itself. But if Mr Lim talks again, be careful of ISA. You will be accused of treading on dangerous waters, being anti Malay, anti Islam and anti Royalty.

    Petrol is trading at USD65. Why is the Msian Gov still holding on? That means the petrol companies are making hell a lot of money. Another UMNO scam.

  14. #14 by edmondr on Saturday, 25 October 2008 - 10:16 am

    The share market is but another major gambling den disguised as a legal mechanism for companies to garner capital for expansion. Judging from the world’s obsession with the ups and downs of share market indexes, one wonders whether the numbers actually represent the true economic status of a country or is it merely a roulette of speculation and chance.

    My mother has always warned us to be wary of the stock market as it is a place which can drag a person from riches to rags. Penangites describe the act of investing in the share market as chi toe share (playing with share) or phuak share (gambling in the share market). Both these descriptions have connotations of frivolity and risk in them.

    That is why, it is not wise for the government to use our hard earned savings to dabble in this high risk and volatile game ups and downs. Read more in my blog http://betelnutchronicles.blogspot.com/2008/10/valuecap-gambling-peoples-money-away.html

    Edmond R, Betel Nut Chronicles, Penang

  15. #15 by hadi on Saturday, 25 October 2008 - 10:18 am

    Yes YB Kit, time to mobilize the people. The goons and scums running the nation must not be allowed to do thing as they like. They are taking for granted that Malaysians are all stupid and only those in power are the gifted brilliant and intelligent of them all. Tell them especially the finance minister my foot….
    They are not listening at all and for the past few days of the Parliament budget debate, they were not seen at all. Please ministers stop lying and stop telling the people you are too busy. People are getting sick and disgusted.
    YB Kit, time for Pakatan Rakyat to look for the long tested traditional option-MOBILIZE the RAKYAT.

  16. #16 by cazz on Saturday, 25 October 2008 - 10:19 am

    UMNO is cutting out flesh and feed it to the crocs.

    NO, we all should be shouting out a big NO to UMNO on dipping into out piggy bank again.

    This is a daylight robbery. There is no investment plan, there is no loan facility plan of any sort. THis is UMNO robbing our hard earned money and distribute it to their cronies, so they could maintain their shamelessly luxurous lifestyle, more wifes, more expensive cars, bigger mansons. Those who voted for UMNO in March 2008 are accomplice in this ruthless robbery.

    What Valuecrap will do is simply buying those sinking shares, jack the price up with our hard earned cash, and the cronies will just keep throwing out their shares, fishing our money out of the market until the 5b depleted. This is not a matter of throwing salt into the sea, it is worse. This is a plot of cutting our flesh and feed it to the crocodiles.

    Run a petition, you would need a pice of miles long paper for the signatures. Stand up fellow countrymen! Sout NO to this robbery.

    First, it was Mahathir now it is Najib.

    It needs to be stopped. It needs to be stopped right now!

  17. #17 by taiking on Saturday, 25 October 2008 - 10:23 am

    Sorry a Diversion.

    Star Online today, 25 Oct 2008:

    “Jalan Alor will keep its name – that’s the decision of Federal Territories Minister Datuk Seri Zulhasnan Rafique.”

    I say stupid fools for changing the road name in the first place. And in case they didnt know yet once a stupid fool always a stupid fool. It cannot be undone like the name change, forth and then back.

    Another quotation, ibid:

    “Datuk Seri Najib Tun Razak says he is working towards the gradual liberalisation of the New Economic Policy (NEP) and elements of this can be seen in the not too distant future.”

    Oh those are very very ambiguous words. So ambiguous that it is almost meaningless.

  18. #18 by Jan on Saturday, 25 October 2008 - 10:28 am

    EPF money belongs to all of us. I suggest Pakatan makes a BIG BIG issue out of this to let as much as possible the people of Malaysia know what this UMNO-led govt is doing with our hard-earned money and I suspect it’s up to no good.

  19. #19 by wanderer on Saturday, 25 October 2008 - 10:33 am

    This is certainly a doggy business investment proposed by the ‘almighty’ in putrajaya. We have to wait and see, whether, they will start to listen to the people or remain indifferent and as arrogant.

  20. #20 by passerby on Saturday, 25 October 2008 - 10:39 am

    I think the stock market collapse is a good thing because it will finally flush out all those dirty and corrupt deals which have been buried under layers of fictitious companies. This is just like a river finally exposed all the big stones underneath when the water is low.

    During the boom time, these corrupt government uses all sort of fanciful schemes to enrich themselves and their cronies. They either privatize crown corporations or approve mega projects to themselves or their cronies and when they fail in their projects, they will bail them out with the people’s money.

    With the economy now going south where the country will be heading, everyone survival is at stake and the rakyat must be vigilant against any corruption by the government. The people must question every purchases and expenditures and made sure that the government provide justifications for such payments.

    Ultimately, the only way to stop these corruptions is to kick out these bunch of crooks and robbers. Let us hope this recession will finally wake up all the people to unite together to kick out the corrupt BN!

  21. #21 by pakmang on Saturday, 25 October 2008 - 10:42 am

    Since it is economy meltdown and financial crisis globally, I suggest the EPF department should refund portion of money to the members again to assist to overcome thier finanacial problem other than to take the EPF money to ailing the listed problem companies which are not relating to us…..

  22. #22 by just a moment on Saturday, 25 October 2008 - 10:59 am

    Its borrow from EPF, I wonder at what interest rate this morons gonna pay us back. In just doesn’t add up, is he doing it for the rakyat? No evidence at all. Either way, monies going out will definitely benefit ‘croonies’ companies regardless the outcome of the investment. Kaput lah.

    Why from EPF? There are many more avenue for the Goment to source funds such as from Petronas isn’t it? Why go for rakyat’s retirement life line and what right does he have to simply touch our money as if its a cookie jar? I’am not convinced at all he has the rakyat’s interest in mind besides there are many other priority stuff he ought to be doing for the rakyat. Get rid of ISA and the botak first. That itself, will do more benefit for the rakyat.

    Its only in Bolehland, where anything that’s impossible in the entire world, is made possible only by our Goment. Number One. Every other headlines today from this Goment, can either be an insult to intelligent or an exhibit of moral decay.

    In less than a Yr, since last GE, the amount of mockery, incompetencies, oppression, party crisis, inmoral activities from authority, abuse of power, exposure of ill gained contracts, crime rate, are pilling up higher and faster than all previous election, put together. Once again, Malaysia-Memang, Mesti Boleh!!!
    Sick of it all.

  23. #23 by Swordsman on Saturday, 25 October 2008 - 11:23 am

    The “Valuecap” issue should not be viewed as just a matter of abuse of political power and misuse of EPF contributors’ funds.
    Instead we should view the matter in its entirety by probing deeply into these fundamental questions:
    1. How does EPF invest its funds? If it is an efficient and performance-oriented investor, how come it has an idle fund of RM5 billion ready to make a foray into the KLSE via Valuecap on short notice?
    2. What is the role of Valuecap? Are its investment objectives congruent with that of the EPF? How does EPF benefit assuming that Valuecap has made capital gains on the stocks ‘acquired’ using EPF funds? Does EPF stand to gain or just get paid the interest on the RM5 billion loan, and who guarantees the principal loan and interest?
    3. Is there any provision in the EPF Act or its internal investment/lending policy that allows the Finance Minister to dictate to the Investment Panel of EPF as to where they should channel EPF funds with total disregard of the contributors’ interests?

    Relating to the 1st question are these salient points:
    a. The EPF (and this is my guess) has funds totalling close to RM300 billion.
    b. The bulk of its investments are in Govt bonds, financial instruments, trade and services, and an insignificant portfolio in manufacturing industries.
    c. EPF is prohibited to invest “off-shore”.

    We are aware that contributors had been clamouring for a higher dividend to keep up with inflation and the higher cost of living. Assuming that the EPF has set a dividend payout of say 5%, it must earn a net income of at least 6.5%. Based on a fund size of RM300 billion, it has to earn RM19.5 billion. How could EPF earn this level of income when there are just not enough “justifiable investment opportunities” to absorb RM300 billion? The bulk of its investments in Govt Bonds pay only 4% or thereabout. We are not sure whether the 4% dividend payout to contributors are actually “earned” or are they just book entries to be “covered back” from future earnings.
    The Parliamantarians must take a closer look at EPF to allow it to be a “competent and global” investor in this Globalized Age. Otherwise how could it fulfill its role of providing “retirement security” to our Senior Citizens? EPF’s fund size will continue to grow,(unless its Management screw things up big time) and it is just not prudent to put all the “EPF eggs” in our “Malaysian basket” knowing fully well that the standard of Corporate management and governance are still below the desired level. The regular manner the BURSA issues Letters of Reprimand/Warning to corporations are just too stressful for investors.
    It is simply because all the “EPF eggs”are in the “Malaysian basket” that the Govt is tempted to move the “eggs” around as they wish.

    I do not know much about Valuecap. My speculation is that it is a “Safety Net” for GLC counters and “darling stocks” held in high favour by Govt leaders. Any investor who is worth his salt live by these mantras:
    a. No individual, entity or even Govt can “fight” or go against the
    b. “Heart of stone, mind of steel,
    On the phone, do the deal”

    (a) was clearly illustrated in the 1980s when the Bank of England
    pumped 7 billion pounds in an attempt to shore up the British pounds. The “strength” of this 7 billion pounds lasted just 2 hours, and the Bank of England surrendered to the market immediately. Incidentally, our Second Finance Minister Nor Mohd Yaccob, then advisor to Bank Negara. lost tens of billions of RMs in this fiasco.
    He should do his job of enlightening Najib on his “bad” experience of the 80s lest Najib repeat his “London” act in KL.
    Prudent investors have “heart of stone” and “mind of steel” towards share prices and market sentiments. Najib also has these two “qualities” but have them misplaced somewhere else…. against the interests of the Rakyat.

    On the subject of possible abuse of power at the expense of the Rakyat, I leave it to the PR MPs to argue it in public forums and debate it in Parliament.

  24. #24 by monsterball on Saturday, 25 October 2008 - 11:27 am

    Yes stock market crash is good…to flushed out crooks.
    But…speculators are no fools.
    The professional ones.. will gamble…and pull out their funds ..as fast as they can…from the crooked companies.
    They know.who they are.
    The crash does not mean…real decent…blue chips…are suffering.
    Whenever you hear our government are going all out to bail out this or that…..they have inverted interests in those companies.
    In USA…the government political personalities love to gamble.
    So they are actually saving their own skins..saving Americans..at large.
    UMNO is doing the same thing….not for Malaysians…but for rich guys….mostly their own relations..and selected Malays.
    Signs of saving failed companies…banks…are always…to benefit the crooked investors..in Malaysia.
    If one think seriously..if more rich guys..become poor…then the playing fields will be more level and true.
    It’s……having..the “haves” and “have nots”…. show….how corrupted a country is….when one race is favoured to have all.
    In that sense…USA is much better than Malaysia..on…treating everyone…equal.

  25. #25 by k1980 on Saturday, 25 October 2008 - 11:34 am

    Who are the guarantors for this huge loan?
    What securities are given to EPF in return for the RM5 billion?
    If Valuecap defaults on this RM5 billion “investment”, who is going to replenish EPF’s coffers with another RM5billion?

  26. #26 by Jan on Saturday, 25 October 2008 - 11:41 am

    I remember Valuecap started off with RM10 billion how come now only RM5 bil? Where’s the other 5 billion? Don’t tell me they lost RM5 billion now want to raid our EPF for the another 5 billion. The problem with Valuecap is they operate stealthily and never announces what terms they give to EPF. In other words it’s as though EPF is an ATM machine, just take whenever they like. THIS GOT TO [email protected]!!**!!

  27. #27 by mauriyaII on Saturday, 25 October 2008 - 11:53 am

    ValueCap began operations about 5 years ago with a confirmed paidup capital of RM10 billion. With UMNO and Nor Mohamad Yakop to helm ValueCap its operating capital now stands at RM5 billion.

    What happened to the other RM5 billion? Something like RM 1billion lost for every year of operation.

    When you have a joker who lost RM 30billion of taxpayers’ money on forex speculation as the 2nd Finance Minister, what can Malaysians expect?

    Now we have a new Finance Minister who says the Malaysian economy and its fundamentals are strong enough to stand the ongoing global economic crunch. If he believes in his own spin why try to deplete the EPF by taking out RM 5billion to shore up ValueCap?

    This unhealthy trend of taking public savings to bail out ailing and non-performing companies was started by the old goat who just wanted easy money to bail out his son’s bad debts and that of his cronies.

    Now that Mahathirism is on the rise again, the old goat’s deciples like Najib and company need to take his advice to run the country’s economy. Otherwise they may not get elected during the March UMNO elections.

    The old goat’s expertise has all along been the ability to squeeze the balls of all his followers and enemies alike to get whatever he desires to accomplish.

    What sort of advice can they get from the old goat other than to dig into the savings of the rakyat in EPF? With the media in their hands to do their bidding by glorifying their so-called shrewd business acumen, what can the rakyat do?

    The country was raped, pillaged and the citizens sodomised for over 22 years by the old goat. Still, he is not satisfied from the looks of his racist comments and how he expects everyone to dance to his tune even after leaving the government to his lame duck deputy.

    Before the rakyat could even heave a sigh of relief, the Sleepy Head’s 5 years hibernation, despite his pledge to reform the country’s ailments, has taken more than its share of corruption, cronyism and misgovernance that was started by the mamak and his mamak Finance Minister.

    With Anwar’s promise to form the next government no way in sight and with Anwar and the BN still locked in the numbers game of MPs and horse trading, can the rakyat hope to see the revival of the economy, the reforms in the judiciary and the police force?

    EPF should not give in to the demands of the UMNO warlords and the emasculated BN component parties to hijack funds that belong to the EPF contributors until and unless ValueCap divulges its accouts for the last 5 years’ of operation and comes clean on the heavy losses incurred.

  28. #28 by Emily Pratt on Saturday, 25 October 2008 - 12:09 pm

    Just like how a commercial bank treat its borrower normally, we (the stakeholder in KWSP) demand that ValueCap S/B provide equi-amount in collateral for the RM 5Billion loan.

  29. #29 by isahbiazhar on Saturday, 25 October 2008 - 12:22 pm

    The government cannot print money so they have to rob from EPF or perhaps from Tabung Haji and PNB.The situation is critical.If my calculation is correct our stock market may touch 600.It will be time for those who have that excess(worthless money) to buy because even gold can be useless.Nobody should sell land or building as they will price better in the future.Till the stock market which will pick up in 2012 all Malaysian be beware because any monetary miscalculation will drive them to despair.Americans have driven us to this situation but we never learnt.Till they get their house in order we will forever be at their mercy.It is time to strengthen Asia for Asia sake and not for others.I am not being selfish but when we are led by the west we seem to forget our own brain.We suffer though globalised but now we should think of Asiablised!

  30. #30 by comingto50 on Saturday, 25 October 2008 - 12:23 pm

    Do not take us for a fool. If ValueCap is profitable it does not need the funds. Furthermore, it will be trumpeting its success and great performance and show off it’s report. Suddenly we find the MOF is eager to help EPF to make money. Since when????

    Up to this day there not one single release of financial data of ValueCap performance.

  31. #31 by pangwl88 on Saturday, 25 October 2008 - 12:34 pm



  32. #32 by pangwl88 on Saturday, 25 October 2008 - 12:38 pm

    MIND YOU!!!!!




    PISS OFF!!!!!!!!!!!!!!!!!!!!!

  33. #33 by Jeffrey on Saturday, 25 October 2008 - 12:51 pm

    After hemorrhaging so far our market capitalization may be around RM500 billion?? Another RM 5 billion, a mere 1% cannot not prop market slide…but can prop selected GLC or UMNO or BN linked or cronies counters.

    It is a desperate move to resort to EPF Funds, a kind of last resort.

    The challenge of the financial tsunami is owners of these shares of companies that are GLC or UMNO or BN linked or cronies counters may b e pledged heavily the banks and have to top up eroded margins or face force selling by banks that ends up with these owners losing control over the companies or otherwise getting nothing back by way of residual value when the shares are forced sold.

    We are headed for doom and glom because the immediate scenario is bleak. Banks are now so selective that they may be generally considered not giving out loans anymore and whilst doing this, are at the same recalling loans and credit from companies that are not the Genting or the DIGI Types, even though these companies have been servicing the loans and credit without default. Banks don’t want to wait until 6 mths to a year time when they have to join the queue with other banks to ask back their money when these companies become distressed, therefore having to take huge haircuts. When the banks do this, a lot of the companies asked to repay can’t do so and can’t refinance from other banks equally not wiling to incur exposure and risk. So being unable to pay, the companies that have pledged shares will see their shares again force sold. We are therefore in a self feeding cycle of force selling triggered by panic sentiments….

    I guess ValueCap’s 5 billion is the answer to give breathing space to GLC or UMNO or BN linked or cronies counters. (I am speculating here. This is because there is no transparency regarding which counters the shares of which Value Cap would use the RM 5 billion to buy….. )

  34. #34 by Jeffrey on Saturday, 25 October 2008 - 12:58 pm

    The question is whether these “favoured” counters or ValueCap would meet EPF’s investment criteria….

    EPF is governed by EPF Act.

    It cannot act beyond authority of the Act. It will otherwise be “ultravires” the Act and unlawful….

    Section 26A (1) of EPF Act says that EPF may (a) invest in loans to an approved company or (b) the buying of shares in an approved company.

    Now if Loan of RM5b were given to ValueCap, it would be under (a) above.

    But does ValueCap qualify as “approved company” within meaning of Section 26A (1) of EPF Act for the loan to be given by EPF to it?

    It has not yet accounted for the “missing” RM5 b out of the original capital of RM10 b injected into it.

    An approved company, according to Section 26A (2) of the EPF Act is one that has “a dividend at the rate of not less than five per centum upon such ordinary share capital during each of the last three years prior to the time of investment and where the approved company is a company which has acquired the assets and liabilities of another approved company, payment of a dividend by that other company during each of the last three years prior to the time of such acquisition shall be treated as payment by the approved company”.

    Does ValueCap, even as an aproved company by ministerial fiat, meet this investment criterion in Section 26A (2) of the EPF Act to qualify for a loan from EPF???

  35. #35 by Jeffrey on Saturday, 25 October 2008 - 1:06 pm

    of course banks may be directed not to force sell the favoured counters shares. But if eventually the banks lose chance to recover monies – how? Most of these banks may be also directly or indirectly – and ultimately- linked to poltical parties and their cronies….

  36. #36 by 9to5 on Saturday, 25 October 2008 - 1:17 pm

    We have to be very clear that the relationship between EPF and Valuecap is that of a lender and borrower. EPF lends money to Valuecap and EPF derives an interest (albeit low interest) from it. No matter how much profits Valuecap makes from his investments, EPF has no stake in the profits; EPF will just get his agreed interest, no more no less!

    When the stock market goes north, Valuecap will make a lot of profits but EPF will get his due, low rate of interest as a lender of money. But when the stock market goes south, Valuecap’s investments become bad and Valuecap may go bust. In this case EPF will lose all its RM5 billion loan unless the Government bails out Valuecap or pays to EPF as a guarantor. If the Government bails out Valuecap, the public will be the loser and if the Government doesn’t, the EPF contributors will be the losers. Either way it is the poor Rakyat who suffers!

    Right now the companies that makes the most losses in the stock market are the UMNO counters. The share prices of these counters have plummeted the most and this RM5 Billion EPF moneys together with an undislosed RM? Billion of taxpayers money are going to be used to bail out UMNO crony companies. Using EPF money to buoyant the stock market will not increase an iota in the efficiency or reserves of our economy.

    In every which way, UMNO’s cronies will profit from the deal because if the stock market goes up, Valuecap will make an enormous profit. If the stock market goes down, UMNO’s cronies will buy back the shares at lower prices which they sold to Valuecap earlier at higher prices.

    This rotten UMNO Government thinks that the Rakyat are suckers to be so easily conned into believing that the EPF will benefit greatly from the low share prices! They are just taking advantage of the low interest of the EPF loan to the detriment of all workers who have given their sweat and tears in contributing to EPF for all these years. It is one of the many abuses of the NEP – using the poor pensioners’ money to finance the rich UMNOputras in the share market which has not helped the ordinary Malays in anyway.

    If the investments are so lucrative as claimed by Nor Mohamed Yakcop why don’t EPF invest directly in the stock market rather than lending the money to Valuecap and allowing Valuecap to profit from it? This is not the first time that Nor Mohamed Yakcop has used the rakyat’s money to indulge in gambling. In the 1990s he was involved in betting in foreign exchange futures which costed Bank Negara Malaysia RM30 billion in foreign losses. He gave the same exact reason for undertaking the foreign exchange betting – benefit and value to the country when the foreign exchange had dipped so low! But what happened? It caused the loss of RM30 billion of the hard earn money of every rakyat! And this same guy is doing it again!

    Why only stop at protest? Can the oppositions, labour unions and lawyers study the following legal implications and make the necessary police reports to take legal actions in court:

    1. Can the Finance Minister unilaterally direct the EPF money to be lent to a private company and used for shoring up the stock market that is akin to gambling?

    2. Can EPF contributors who have a direct interest in protecting their money file an injunction in the court to stop this?

    3. Can EPF management be held liable for acting ultra vires to the constitution of the EPF Board by lending this money to a private company at low interest and without adequate feasibility study and protection?

  37. #37 by Emily Pratt on Saturday, 25 October 2008 - 1:25 pm

    To ValueCVap S/B: Give us RM 5Billion in collateral and we will you the loan.

    Signed: Emily Pratt, a depositor of KWSP

  38. #38 by chengho on Saturday, 25 October 2008 - 1:26 pm

    uncle Lim,

    Rakyat want to hear your economic agenda so far nothing only shouting, critic ,road show ,demo,etc
    where is DAP or Pakatan so called alternative budget plan ??? nothing …

  39. #39 by human1 on Saturday, 25 October 2008 - 1:27 pm

    EPF is acting as the trustee for the working class who submit the deduction of their payrolls, to the fund managing the objective of retirement planning. Valuecap Sdn Bhd is an asset allocation company with RM10 billion startup, a government initiative setup end of 2002, co-owned by Khazanah, PNB and KWAP. Why is it now having RM5 billion asset? Where did the other RM5 billion go? Did it make any money from the stock market? If yes, how much did it pay back the government? Nobody can answer that as this is a private limited company and it has no obligation to disclose its balance sheet to the public.

    Stock market investment is an interesting business, where risk and opportunity co-exist. For common people who do not have the money but want to play in the market, you can do this by buying on margin, to buy stocks on borrowed money. This usually subjects to the interest payment which you and the creditor agree. Buying with borrowed money can be very risky because yes, high risk high return and nobody can truly see ahead the future where the market is heading.

    In this case between Valuecap and EPF, the people do not see any money-back guaranteed terms and conditions. Therefore, I assume:

    i) there is no interest payment on the RM5 billion loan.
    ii) when making severe losses in a bear market, Valuecap will say too bad and need not pay back EPF.
    iii) when making huge profits in a bull market as the undervalued stocks investment turns out to be what Nor Yakcop (don’t trust a guy too much, who had lost RM15 billion in the infamous forex speculation) has suggested, it will be up to Valuecap to share the profit margin with EPF, in addition to the RM5 billion loan payback. How I wish I am Valuecap and secure the this type of loan from EPF.

    When announced that he would table more measures on 20-Oct Monday to address the global financial crisis, I bet the people were thinking about direct measures that are able to lighten their daily burden like reduce price of petrol. Instead, this magical measure has the analogy close to criminal breach of trust.


  40. #40 by comment on Saturday, 25 October 2008 - 1:29 pm

    Pakatan Rakyat should question this in Parliament. Even if EPF should invest, it should be in the form of loan with interest at least 5%. It should not be in the form of direct equity stake in ValueCap. If the shares on Bursa are undervalued, then EPF can but the shares directly without going through ValueCap.

    There are lots of rakyat complaining that there is too much politicking. Now this is a real issue worth debating/asking.

  41. #41 by Dr.Ken on Saturday, 25 October 2008 - 2:02 pm

    This a broad daylight Robbery cum Corruption by the malaysian Gov’t. Using EPF fund to soar up stock market . Now soar up which particular stock more in the market, obviously will soar up those stocks own by those BN politician. Morally it is corruption.

  42. #42 by Jimm on Saturday, 25 October 2008 - 2:07 pm

    this scam involved the entire elit group which consist our our land owbers and their family members too….
    we undestand the concern here whereby the land owners are too afraid to lose their ownership or crownship and that is why they keep protecting umno …..
    we ,rakyat are asking the land owners …. how long does it going to take for you to understand that life doesn’t pays when you took a ‘shortcuts’ ….

  43. #43 by akarmalaysian on Saturday, 25 October 2008 - 2:13 pm

    just a thought for u guys….wud u trust a thief to handle ur piggy banks?

  44. #44 by frankyapp on Saturday, 25 October 2008 - 2:34 pm

    I think the rakyat now must stand united and tell the present government not to mess around with our hard and sweat earned money just to help those umnoputra linked companies. Our opposition must act fast and with the rakyat helping see no reason to stop the BN government from abusing the rakyat’s cash.

  45. #45 by tselau on Saturday, 25 October 2008 - 2:35 pm

    Maybe they have already taken the money from EPF liao. Cuma bagi tahu saja. Too late to protest already. We need to get Uncle Kit to check with EPF.

  46. #46 by ablastine on Saturday, 25 October 2008 - 2:45 pm

    All of us here can complain, speculate, exhort and reason against the 5 billion hand out from EPF to Valuecap. In the hands of all the theives and robbers from BN and specially UMNO I can be sure of one thing-that 5 billion will be gone is a few days when the stock market collapse further. I bet my last dollar that all of it will be used to prop up BN cronies’ company and eventually end up in the pockets or Swiss accounts of these gang of thieves. In fact this is not the first time this is happening. Daylight robbery of the nation takes place every single day. That is the reward we are sowing for having a government whose primary interest is to self profit. If they remain in power for much longer, the next Pakatan government we inherit nothing much other than all the debts these bastards have accumulated over the years.

  47. #47 by yhsiew on Saturday, 25 October 2008 - 3:03 pm


    TDM said money politics is still rampant. So, don’t let EPF money become bait through ValueCap during UMNO nomination time!

  48. #48 by scooter on Saturday, 25 October 2008 - 3:55 pm

    If they tell me what they have done wrong and swear to GOD that they will never cheat us again then maybe I will lend them my money.

  49. #49 by loveandgratitude on Saturday, 25 October 2008 - 4:36 pm

    Keep on harping in this issue in and out of Parliament. Luckily this time we have so many PR MPs; so don’t let the ruling elite abuse the common citizen pension money.
    Stay in good health, Uncle Kit.

  50. #50 by Jana on Saturday, 25 October 2008 - 4:37 pm

    The UMNO goons are now lying their tainted hands on our hard earned money. The Malaysian work force has to arise and protest. Its time for the trade unions to come out of their cocoon and stage a nationwide protest to stop the thieves our retirement money.

  51. #51 by dap-for-pj on Saturday, 25 October 2008 - 4:39 pm

    TNB refuse to lower rates because it says most of the power plant runs on coal and natural gas!……………………………pathetic explaination! Even if it is true, then what is the rationale for raising the prices in the first place if it is not because of petrol increases? JAHANAM PUNYA GOMEN, NUTJIS THE ECONOMIST, EAT MY FOOT!

  52. #52 by newchief on Saturday, 25 October 2008 - 4:48 pm

    Is this the correct way for BN to simply ‘force’ EPF for a loan of RM5billion just to push up the KLSI via Valuecap without going through proposal in parliament? If this is so, we fear that our hard earned ‘retirement benefits’ might go down to drains IF Valuecap doesn’t perform well !! if Valuecap can’t pay back or won’t pay back to EPF, all they need to do is go bankrupt – just as simple as that & giving excuses that they had invested in the wrong shares or blame it on the world. where can we poor people claim our money then ??

    also, EPF should have its expertise on investing and need not rely to borrow to Valuecap for easy gains as this is also a VERY HIGH RISKS LOAN!!! let’s say if everything goes smoothly and EPF can reap in the interest profits, i have my doubts that it will go into our accounts THOUGH ITS OUR MONEY THAT EPF IS USING ( WITHOUT OUR CONSENT!!! )

    i feel bn especially najib (now that he’s the finance minister) and the 2nd finance minister (not counting badawi) is not competent AT ALL in this field!!! they are using the easy way out (as always) to bozer through a plan without debating because they knew it will be met with tremendous objections!!

    i jz want to point out that if i want to borrow my OWN MONEY to reneovate my house from my EPF, they will say there is no such law !! but when they use my RM to loan to valuecap or any others or using it to spend lavishly, i cannot question their acts !!— IS THAT FAIR!!!! Dtk???

    i hope dtk will comment that najib and 2nd finance minister has abused their power to using the rakyat’s money without the rakyat’s consent and anyone involved should be coiled in (not to ACA bcs its their yea-men) but be dragged to Courts TO SUE THEM for using our EPF Savings !!! its like stealing our money !!! I hope Dtk can come up with a speech that will convince all especially the bn yes-men to sokong that najob and 2nd finance minister be sacked !!!

  53. #53 by newchief on Saturday, 25 October 2008 - 5:00 pm

    bo , nashit & 2nd finance minister always proudly boosts that malaysia has enough financial reserves than the rest of the world so we need not worry!!

    if that is so, why the hell TOUCH OUR HARD EARNED MONEY IN EPF!!!??? why not use the reserves to buy whatever via valuecap!!?? who knows, another crooked con business will go through using EPF funds also in the future!!

    noone can guarentee 100% on high risks especially in KLSE!! bn is fooling us that valuecap can do it. bn or valuecap should in fact use their own personal money on these instead. i hope someone of high calibre with knowledge of law in their hand to SUE BN , valuecap & EPF for swindling with our blood-money as please as they want WITHOUT OUR CONSENT!!!

    if we want our money for emergency like renovating our depleting or leaking houses or paying for arrears in loans for cars or houses or even to buy makanan because we can’t afford anymore from our own pockets, EPF will surely REJECT US THOUGH ITS OUR RM!!

    with bn , my god, we are robbed of our own money under our nose and we can’t do a thing about it. if epf goes bankrupt, so will we & bn won’t come out to bail out us out!!!

    look at klse now. its not going upwards but sinking and that’s very worrying. is the rm5billion going doen the drains or going to someone’s pocket??? PLEASE ACT NOW BEFORE ITS TOO LATE …ANYBODY PLEASE!!!

  54. #54 by Jeffrey on Saturday, 25 October 2008 - 5:33 pm

    One has to understand the nature of BN’s politics and the ultimate source of its power, and maintenance of power.

    Our rulers’ power base is structured upon crony capitalism. It is money politics. With money, votes can be organised, garnered and delivered.

    With money, largese and patronage could be dispensed; loyalties and allegiances secured or bought, discontent pacified, power could be maintained if not perpetuated.

    What the current financial crisis presents is an unprecedented challenge to our political elites and their political power.

    It strikes at the very source of their power base : money. It might well be a great leveller.

    A further stock market crash will wipe out billions and billions of capitalisation, a sizeable portion of such wealth belongs to the ruling parties, elites and cronies. So will a concomitant fall in values of real estate property.

    With unemployment soaring, people who traditionally support the government will rise, blame and turn against the people in power.

    Whilst the government has to tackle the economic challenge, it has also to think of ways and means, sources of funds, to prop up and protect at the same time values of assets owned by the ruling elites within our system of political crony capitalism. They would look to EPF, Petronas whatever….

    It is a kind of challenge that our elites are not used to and familiar with the remedy.

    They could handle Hindraf, RPK and maybe Anwar. We have plenty of laws to do that.

    They have encountered and experienced in last century cyclical downdowns of the economy whether due to too high oil prices, hedge fund attacks on the currency etc but this one is what former Federal Reserve Chairman Alan Greenspan describes as a “once-in-a-century credit tsunami”.

    Can they rise to this unprecedented challenge to their power caused by an external induced global breakdown of the credit cycle and concomitant disruption of workings of the free market system over which they could not control nor escape from?

  55. #55 by Godfather on Saturday, 25 October 2008 - 7:05 pm

    Jeffrey is right – RM5 billion can’t prop up this stock market, and will only disappear like a drop of ink in the ocean. We should take a lesson from Hong Kong about transparency in market intervention.

    In 1998, the HK Monetary Authority with the approval of the lawmakers agreed to use the surplus balance in the exchange fund (created due to the peg of the HK Dollar to the USD) to prop up the stock market. The HKMA was totally transparent about the stocks that it bought or sold, and reported a quarterly profit or loss to the legislative council. I believe that the fund now stands at HK$200 billion (RM 100 billion equivalent). The objective of the fund is not just to prop up the market – it is supposed to stabilise the market at times of “irrational exuberance”, and the fund will sell its holdings if it deems appropriate.

    Transparency is the key – people will believe you only if you are transparent about your holdings and your profit/loss. For UMNO, transparency has never been high on its objectives because Valuecap, EPF and other funds are simply treated as their piggy banks.

  56. #56 by UzMiNoOnist on Saturday, 25 October 2008 - 7:40 pm

    Hurray, for once God is punishing the UMNO dominated Government financially. And to avoid the pain inflicted due its 51 years of sinful cheats and corrupt practice, it will resort to any means like stealing the funds from EPF.

    Good, down to hell to Khazanah Nasional Bhd, Permodalan Nasional Bhd and Kumpulan Wang Amanah Pencen. Its time to see you guys suffers like the marginalized and impoverished Malaysian. Hurray….

  57. #57 by jacksojulian on Saturday, 25 October 2008 - 8:32 pm

    We do not know many people will be saved by dumping 5 billion into share market. But if Government really want to spur the economy, i think cutting down fuel price to RM 1.30 definitely will help millions of people. By bringing down the inflation, tax cut, reduce interest rate in order to stimulate spending in the market (not stock market) will really help in our economy.

    We are the oil exporter, we have the advantage to implement such policies.

  58. #58 by butul on Saturday, 25 October 2008 - 8:40 pm

    I have been an EPF contributor for 20 years before starting my business five years ago. It has been an ongoing business until early this year due to rising prices and bad economy. Would EPF consider allowing me to withdraw some of my EPF to save my business? No way!!

    I have to sit back and watch my company go down while my money is used to save some corrupt and crony company!! What rubbish!!

  59. #59 by aries66 on Saturday, 25 October 2008 - 8:51 pm

    This is No Good !!!. Government is using our hard-earn money that we reserved for retirement to gamble. It exploits the rights of RAKYAT. Do something PKR or DAP to stop this attempts in Parliment
    whenever possible. We count on you now !!! We are really sick of this. Big Thanks to YAP Lim Kit Siang of reviewing this matter to be
    known by everyoneof us.

  60. #60 by human1 on Saturday, 25 October 2008 - 9:07 pm

    EPF is acting as the trustee for the working class who submit the deduction of their payrolls, to the fund managing the objective of retirement planning. Valuecap Sdn Bhd is an asset allocation company with RM10 billion startup (although today Star says it actually started with RM5 billion, who you trust since transparency is zero), a government initiative setup end of 2002, co-owned by Khazanah, PNB and KWAP. Why is it now having RM5 billion asset? Where did the other RM5 billion go? Did it make any money from the stock market? If yes, how much did it pay back the government? Nobody can answer that as this is a private limited company and it has no obligation to disclose its balance sheet to the public.

    Stock market investment is an interesting business, where risk and opportunity co-exist. For common people who do not have the money but want to play in the market, you can do this by buying on margin, to buy stocks on borrowed money. This usually subjects to the interest payment which you and the creditor agree. Buying with borrowed money can be very risky because yes, high risk high return and nobody can truly see ahead the future where the market is heading.

    In this case between Valuecap and EPF, the people do not see any money-back guaranteed terms and conditions. Therefore, I assume:

    i) there is no interest payment on the RM5 billion loan.
    ii) when making severe losses in a bear market, Valuecap will say too bad and need not pay back EPF.
    iii) when making huge profits in a bull market as the undervalued stocks investment turns out to be what Nor Yakcop (don’t trust a guy too much, who had lost RM30 billion in the infamous forex speculation) has suggested, it will be up to Valuecap to share the profit margin with EPF, in addition to the RM5 billion loan payback. How I wish I am Valuecap and secure the this type of loan from EPF.

    When announced that he would table more measures on 20-Oct Monday to address the global financial crisis, I bet the people were thinking about direct measures that are able to lighten their daily burden like reduce price of petrol. Instead, this magical measure from Najib has the analogy close to criminal breach of trust.

    The market is not 100% efficient. The RM5 billion may probably be eroded in the long run, say 10 or 15 years. Unlike banks, the law has not allowed the EPF members to make a run on EPF before reaching their age of retirement. The losses will not be evident, as long there are new members entering the job market and start contributing to the fund yearly.

    Who are the goons advising Najib? I think Najib has failed miserably in his first task addressing the economy issue, by instructing EPF to loan RM5 bil to Valuecap, he might be as bad as Abdullah in the economy subject.

  61. #61 by human1 on Saturday, 25 October 2008 - 9:21 pm

    I do not understand what Nor Yakcop meant by saying EPF will benefit from the loan to Valuecap.

    EPF has always been playing safe, the yearly dividend payout is slightly higher than the market interest rate due to their limited exposure in the volatile equity market investment. High risk high return is not the policy, but rather safeguarding the fund is the objective so that members are able to plan for their retirement.

  62. #62 by mauriyaII on Saturday, 25 October 2008 - 9:30 pm

    When Najib has Nor Mohamad Yakop and the king maker, mamak as his financial advisors, what can a neophite finance minister do?

    I wonder whether his brother who is in the banking industry is one of the puppet masters in this monetary game.

    If EPF is coerced into bolstering the floundering GLCs or other crony based companies, EPF might as well write it off.
    The question is whether EPF management has the moral right or the legal right to squander EPF contributors’ money so frivolousy.

    Can a concerned EPF member get a court injunction to stop such a misadventure on the part of the EPF managers?

  63. #63 by k1980 on Saturday, 25 October 2008 - 9:59 pm

    To show that EPF will benefit from the loan to Valuecap, EPF needs to announce annual dividends of 10%p.a. for the next 10 years. Then only can the EPF contributors agree that the loan will benefit them

  64. #64 by Anak Msia on Saturday, 25 October 2008 - 10:35 pm

    Finance Minister that only knows how to grab money from others (Rakyat’s money), what is the different from begger ?

    he shoulg strategise a plan to lighten or minimise the impact. and not just keep telling us that Msia is foundamentally strong but the other hand, get our money thro’ EPF.

  65. #65 by undergrad2 on Saturday, 25 October 2008 - 11:12 pm

    Why have we not heard from advocates of the free market and of laissez faire ??

    The issue is not about “EPF money being my money” which has been echoed on this blog time and again. The issue is much wider and more fundamental – that of the role of government. How big should government be? Should we trust our politicians to make the right decisions for us??

  66. #66 by sudokuku on Sunday, 26 October 2008 - 2:25 am

    Najis Man ( busuk punya orang ) said ” this is the deal – see, once I use your money to make money, that money become my money – see, if we lost the money it is you money – see”

    Rakyat said ” but sir, I need the money to paid for my child education”

    Najis Man ( busuk punya orang ) said ” what!, why you need money that?, I told you already mah, If you want something you must plan mah, suddenly want money for this, want money for that, I already told to jimat cermat, what you been doing? oh jolly yeh? you think gomen can help everyone like you ah?”

    Rakyat said ” but sir, that my money you are using to help your own company”

    Najis Man ( busuk punya orang ) said ” who told you that?, proof to me it is your money, It is NOT YOUR MONEY until it is your pocket, ok lah pity you lah, tell you what as your leader I will HELP this much, It will Technically be your money once your are eligible, next week we will pass a motion to extend withdraw age to 100 or 115+, with ever come later, if you still alive you be classified as mutant and shot dead, once you are dead or died before that your file will be close & void and your record erase, logic is it not?”

    Rakyat Said ” ……….”

    Najis Man ( busuk punya orang ) said ” pity you la, what kid name?, I will put it into the Ujtm list, see, I go out my way to HELP you, now go out and tell everyone I am a good guy & help you alot”.

  67. #67 by kyototan on Sunday, 26 October 2008 - 5:15 am

    Please be reminded that EPF had a investment board and the rule gave the invest board to decide where to invest. EPF belong to the worker not to the Government as such the Government can not just used the fund to invest into any company. Just as a reminder during the 80’s the fund loan out some fund to individual to rescue their public listed company and in the end EPF were unable to recover the loan. EPF is a fund that is make compusalry for worker to contribute which means worker are force to contribute and it is not the same as other investment or trust fund whereby a person can make a choice not to contribute to it.

    In the case of Valuecap what should the EPF do is to buy Government bond or Loan stock with a guarantee fixed return instead of direct investment into it. The main function of the investment board is to ensure the interest of the worker is protected. I sincerely hope the EPF investment board should object the proposal to make this addition 5B investment into Valuecap.

  68. #68 by chengho on Sunday, 26 October 2008 - 7:21 am

    MTUC President was the lost candidate from Pakatan for PRU 12?

  69. #69 by Godfather on Sunday, 26 October 2008 - 9:01 am

    “Should we trust our politicians to make the right decisions for us??” Undergrad2

    95 pct of the rakyat trust our politicians to milk the country dry. 95 pct of the rakyat know that we must always have our hands on our wallets when we talk to politicians.

  70. #70 by undergrad2 on Sunday, 26 October 2008 - 9:26 am


    When Tunku was PM, the business of the government was to govern. Period. Tunku together with Siew Sin made sure the government did not stray. Then came Tun Razak who together with Tengku Razaleigh changed all that. Mahathir fine tuned it further and introduced Malaysia Inc. putting the country on the proverbial slippery slopes that it has found itself on today.

    It is time we get our butts off that proverbial slippery slope.

  71. #71 by jackpot on Sunday, 26 October 2008 - 9:44 am

    They think that the EPF is running a chain of ATM machines, you want money you go and press and the next minute they press their balls!!

  72. #72 by lextcs on Sunday, 26 October 2008 - 9:50 am

    seems uncle kit missed the point….bailouts are themes of today…look at what the whole world is doing now…bailouts after bailouts…..we would not be doing justice if we dont follow suit….so back off uncle kit…let value cap do its job and dont be a cry wolf baby.

  73. #73 by elvieho on Sunday, 26 October 2008 - 10:31 am

    EPF pun mahu curi
    Badawi atau najib sama kaki
    Valuecap bukan hak kami
    Lebih baik pergi judi
    Kami tahu siapa pencuri
    Nanti Anwar jadi PM kami
    semua akan kena gari

  74. #74 by cazz on Sunday, 26 October 2008 - 10:57 am

    We need a new addition to our legislation. EPF to be made out of bounds to central government.

    In time of national crisis, the fund can only be utilized by consensus of 3/4 majority of the parliamant.

  75. #75 by justice6 on Sunday, 26 October 2008 - 11:55 am

    cut the cabinet ministers’ salary and allowance… that would be enough or more than enough to be pumped into the market..
    for all you know.. EPF have 0 monies … only on paper we can see our money.. in actual form.. they don’t have any.. cos all already taken by the govt.. it’s a bloody Ponzi scheme all along..
    keep our money under our bed is much better than letting those idiots use.. end of the day, what do you get??

  76. #76 by bclee on Sunday, 26 October 2008 - 12:43 pm

    The KL Mayer mss used of fund for so call studies trips to oversea amounted at 1.5M for one years.the latest study trip for 5 officers to Australia used up 450K for 11 days with poket money 20k each persons.
    anither BN goon miss used of Rakyat money for own benafit.

    Shame of u Bee N.

  77. #77 by pkrisnin on Sunday, 26 October 2008 - 1:19 pm

    First they gave EFP member the option to invest their EPF into local stock market but most Malaysian knew GLC/ULC have no base but depend on back door deals with gov.
    Now they forcefully take our money, basically forcing us to invest into another GLC. I doubt EPF will see any profit or even get back the money.
    I rather use my EPF to buy gold right now.
    Angkasawan, submarine midleman, Sukoi Jet middleman and now RM2.3 billion Eurocopters issue.
    – Malaysia Boleh, Boleh what?. Boleh waste money like hell.

  78. #78 by limkamput on Sunday, 26 October 2008 - 2:21 pm

    Undergrad2 says: “Why have we not heard from advocates of the free market and of laissez faire ??”

    THE free market or the laissez faire economy today is about privatising profits and socialising liabilities; is about too big to fail; is about trading monies, future and options that have nothing to do with the real economy; is about governments everywhere not doing what they are supposed to do and doing what they are not supposed to do; it is about macroeconomic policies of most countries aiming at providing “free lunches” (the generation X macroeconomists who think they can create something out of nothing) .

    The first question one ought to ask is where does the US government get the US$700bil? Is the US government really that solvent compared to those banks that it intends to rescue?

    It is a common knowledge that the US government is running massive trade and fiscal deficits amounting to billions of dollars for years. One can only conclude that the government is resorting to the printing press.

    The world’s financial systems have long gone to the dogs. With national governments everywhere able to create money at will, financial prudence, saving, cost of money (i.e interest rate) and liquidity are now meaningless.

    This is the baloney of the free market system as we understand today.

    Then the crunch came. Instead of letting the asset prices to adjust and the banks to take their loss, the governments pour more money into the financial system to save banks and other financial institutions that are “too big to fail” and greedy people who have leveraged themselves to the keel.

    There is no such thing as free market. On the contrary, excessive government intervention is bad. For Malaysia, the secret is to find the right balance: between growth and equity; between free market and government regulation and control; between protectionism and liberalization/globalisation; between excessive profits and social concern and governance; and between competition/meritocracy and patronage/rent seeking. I am experieced enough to tell you when the government have moved too much to the right or left but i think it is too time consuming for me to elaborate all.

    One more point: successful businessmen, wizard currency/equity/derivative traders can’t a good macroeconomist make. They are responsible to the present global financial meltdown; certainly we can’t expect them to solve it. These are the generation X economists I am talking about!

  79. #79 by k1980 on Sunday, 26 October 2008 - 2:39 pm

    Thanks to hallod and bijan, the rakyat will be able to slim down without exercising due to the high costs of food. It is difficult to find obese Haitians and Zimbabweians nowadays.

  80. #80 by bclee on Sunday, 26 October 2008 - 3:14 pm

    “Instead of letting the asset prices to adjust and the banks to take their loss, the governments pour more money into the financial system to save banks and other financial institutions that are “too big to fail” and greedy people who have leveraged themselves to the keel.” quote limkamput.

    Yes 100% agreed with you. no business is too big to failed on current situation but sad to say the government rather than bailing out big Bank and wall street PPL for thier own benafit by putting Tax payers money. what they can do is press on more printing machine. defoicit runing at 12 trillions for us.
    after world market equities fall to the lowers level and bound up aspect usd to fall below 70 mark level for usd index tracking.

  81. #81 by dawsheng on Sunday, 26 October 2008 - 3:54 pm

    “I am experieced enough to tell you when the government have moved too much to the right or left but i think it is too time consuming for me to elaborate all.” – Limkamput

    Mohammad Rafik Kadir, Deputy Governor of Bank Negara said this –

    “We are not seriously affected by the global financial turmoil. We are not saying nil, but on a minimal level.

    “We are not seriously affected. Only 12 per cent of our total export is with the US. We have 11 per cent trading with the EU and about 15 per cent in the Arab world. The majority of our trade is with the Association of South East Asian Nations (Asean), which constitutes about 64 per cent of our trading overseas.”

    What is this? Denial and downright stupid! No point to elaborate.

  82. #82 by dawsheng on Sunday, 26 October 2008 - 4:01 pm

    Remember the trillion Ringgit trade figure?

    RM1 trillion figure insult to our intelligence

    TCM | Feb 13, 07 3:54pm

    I refer to the malaysiakini report 2006 trade highest in nation’s history. I may be no Jomo or Friedman or Greenspan. But I know a little of economics to tell you what RM1 trillion is not. RM1 trillion is not to be divided amongst our 26 million strong population which would put RM40,000 (or US$11,400) in our pockets – each!

    Exports totalled RM588.95 billion. Imports totalled RM480.49 billion. At the cost of oversimplification, assuming that all imports are used up in the value of the exports, then the net gain to Malaysia is a mere RM108.46 million* (or US$31 million, a mere pittance!) [clarification below]. To give you an idea of how big this is, just imagine Microsoft’s net income for fiscal year 2006 – US$12.6 billion.


  83. #83 by limkamput on Sunday, 26 October 2008 - 5:20 pm

    Why the Nobel Prize in Economics was awarded to Paul Krugman and before this Joseph Stiglitz and other US economists. What did they do and what great contributions have they made to the world other than creating “free lunches” and consuming without limitation? What is so great about Asian Central bankers other than continue financing and supporting the beggar who could least afford? I say scr*w the Americans for having too much free lunches and the Asian central bankers for their stupidity.

  84. #84 by lofuji on Sunday, 26 October 2008 - 7:31 pm

    EPF shud change name to MPM(money printing machine) company.I pity dos contributors whose hard earned money is being abused again.YB LKS,can you ask in parliament those leeches what happened to the profits Valuecap made during the 2002-2007 period? Is it properly audited? Aisay,man.All this bullsiht talk about reforms is all hot air la!
    Take a look at petrol.When it went up to US 135,the gomen quickly raise it up by 78 sen.Now when it goes down to US64,the gomen want to reduce it by only 15 sen.Where got fair? Pek Mo Shahrir said that the petrol dealers would suffer if price goes down so much.I ask him “what about the ppl who suffered so much when it was raised 78 sen”
    I thot it is a caring gomen but now gomen clearly show their true colors:ppl dont need to be save,save only the biz man.Pergi la,Pek Mo.

  85. #85 by DingDongBell on Sunday, 26 October 2008 - 10:39 pm

    Same Old ! Same Old ! Sh*T happened and this nothing new.

  86. #86 by veddy.lum74 on Sunday, 26 October 2008 - 11:02 pm

    this is not the first time EPF misusing or told to inject funds to bail-out govt.
    During the Mahatiu era,biliion of dollars were lost due to simply investing their funds with their whims and fancies by the UMNO apppointed stupid EPF directors!

    chief justice from UMNO,KL mayor also UMNO’s crony,Finance Minister:UMNO warlord,Home Minister:UMNO warlord,Education Minister:UMNO’s warlord……………..i think mlaysia now is inbetween Columbia and Italy:The Barbarian country!

  87. #87 by veddy.lum74 on Sunday, 26 October 2008 - 11:22 pm

    this is a very stupid and irresponsible action taken by an inexperience new finance minister!
    take for instance this rm5 biliion are to rescue both Maybank(closed at rm5.05) and Scomi (merely rm29 sen)shares.
    Inorder to prevent Maybank to drop further,Value Capital needs to use a higher price to buy-back a big numbers of it’s shares,say @rm5.25 X 500,000 lots,this will be a very good opportunity for foreign fund hackers to escape by selling all remaining Maybank shares to them at this ‘high’ price!If the global financial crisis get worsen,and the KLCI dive another 50-100 points for the composite index,then,everyone,including you,me and Value Capital can still get cheap Maybank stock at maybe @rm3.95!!!!!I dont think you need me to laborate the SCOMI scenario isnt it?

  88. #88 by peterchiang on Sunday, 26 October 2008 - 11:25 pm

    There are good souls in MCA, GERAKAN and UMNO also but they are at the bottom of the rank and file. The BN is seemingly lead perpetually by KNN wannabes.

    The utmost challenge for any party to remain relevant is to keep good leaders at the core, those with integrity, good governance and good judgement, or CAT as LGE has coined it.

  89. #89 by Cinapek on Monday, 27 October 2008 - 12:27 am

    I must plead ignorance for all these Govt meanderings but to my simple layman’s mind, we have Khazanah and all these amanahs to invest in the Bursa so why do we need another organization to “invest”? And if we look at Valuecap’s three shareholders, they are essentially the same as the parties mentioned above namely, Khazanah, PNB and KWAP. And Valuecap’s investment funds were “loans” made from EPF anyway. A very incestous relationship I must say and to what purpose I am not clear unless this channel is to stay secret and not known to the public.

  90. #90 by undergrad2 on Monday, 27 October 2008 - 12:49 am

    Advocates of free market have long lost their fight when Tengku Razaliegh assumed office as Minister of Finance. From the mid 70s on Malaysia has been on the proverbial slippery slope and has neither the will nor the wish to go off it. It came in the form of the NEP which paved the way for the setting up of bodies like the SEDCs and statutory bodies which worked to displace private enterprise, and which reached its zenith with Malaysia Incorporated and the sogo shoshas during the premiership of none other than its staunch supporter Mahathir.

  91. #91 by bclee on Monday, 27 October 2008 - 12:54 am

    “The EU has floated the ideas of including more bank supervision, stricter regulation of hedge funds, new rules for credit-rating companies and changes at the International Monetary Fund. The French president has compared the effort to the 1944 Bretton Woods conference in New Hampshire that fixed exchange rates, hitched the world to the gold standard and created the IMF and World Bank. “bloomberg news.

    Woow gold standard to monetory policy will be back soon.
    gold will be up.

  92. #92 by wtf2 on Monday, 27 October 2008 - 7:40 am

    if the moron umno and the dumb finance minster wants to play with MYR, soon there will be capital flight. This willbe very serious in this global meltdown. Essentially MYR will have exchange rates problems. Good for exports – naturally – but at the core it’s really selling things at a pittance.

    Anybody with some intelligence will want to protect their capital, the results of the hardwork. Certainly nobody would want to leave their monies in a country which is racist, unpredictable and where the ruling party is populated with morons of the lowest denomination twisting the constitution every which way to earn money.

  93. #93 by ahkok1982 on Monday, 27 October 2008 - 8:24 am

    Why is it that every time there is a problem, their first action is to throw money at it? It just shows that they are void of any other ideas. their thinking always revolves around $$ and nothing else.

  94. #94 by pakmang on Monday, 27 October 2008 - 9:25 am

    I 110 % agreed with Mr BUTUL. We are members of EPF for almost our life time and yet we are unable to withdraw our “OWN MONEY” to safe the financial problems our own company & why should they permit them to loan our money for other listed companies which are not related to us……???its merely bullshit lah…. !

  95. #95 by veddy.lum74 on Monday, 27 October 2008 - 9:35 am

    najis read a book called “how to be successful and to erase problems”,the author said:there are three criterias,take out your pen,write it down so that you can always remember!
    get it?

  96. #96 by veddy.lum74 on Monday, 27 October 2008 - 9:40 am

    the latest joke in town:
    a mayor spent rm1.5 millions to go overseas with his subordinates for “lawatan sambil belajar” this year,you know what was the first thing he did?He changed the reknowned “jalan alor” to “jalan heijora”(in cantonese,means gone!)

  97. #97 by kanasai on Monday, 27 October 2008 - 12:53 pm

    I beg to differ. MYR5.0B is just a drop in the ocean of our market share capitalization. I fully support this idea. 1) To quote the world best known investor and also the wealthiest billonaire Warren Buffet:- we should worry when the stock market is at the peak and we should make to killing to buy when there is market panic 2) Lots of value investments with good investments appear with the current fall 3) Our assets can only increase by investing not saving 3) The saving interest rate is lower than the inflasion rate (negative real interest rate). Cash MYR is losing real value with increasing prices day after day 4) When the price is falling, we must be patient to wait till the market sentiment recover which is better than buying 4D. You are not losing as long as you don’t over-leverage and results in forced selling as US citizens 5) Everyone who don’t invest will also indirectly dragged and affected by the world finance system even with ZERO investment only.

  98. #98 by k1980 on Monday, 27 October 2008 - 2:04 pm

    RM5 billion is just the beginning. Look at the US, they need USD700 billion to prop up their share market

  99. #99 by bclee on Monday, 27 October 2008 - 6:36 pm

    K1980, 700B just a drop of the ocean for US equities and finacial markets. anyway the markets will still trending down.

  100. #100 by butul on Monday, 27 October 2008 - 7:55 pm

    Thanks for your support Pakmang

    For me it’s a true situation. I am a oil palm smallholder who just got in the market 3 years ago. Now that the price of palm oil has collapsed and the cost of production increased tremendously, I find it hard to break even, and if I cannot withdraw my EPF savings to tie me over, I will have difficulties in meeting my instalment payments on the land and my truck. Will EPF consider allowing me to withdraw and save my business? not a chance!

    After paying so much taxes over the past few years, I face the possibility of going under while some other crony and corrupt companies are being rescued by my hard earned money.

  101. #101 by cemerlang on Monday, 27 October 2008 - 10:09 pm

    The EPF is members’ sweat and blood money. The government is given the trust to safeguard and not to mismanage it. Have a heart. Don’t destroy the tiny hope of the EPF members. Actually there should be some changes made like if you reach a certain age, you can choose to draw out all the money. It is your money, by the way.

  102. #102 by DingDongBell on Monday, 27 October 2008 - 10:21 pm

    Same old shit keep repeating. People’s money being abused by unethical personality for selfish political end and personal gain.

    Same Old ! Same Old !

  103. #103 by DingDongBell on Monday, 27 October 2008 - 10:25 pm

    Wow ! State sanctioned robbery again !

  104. #104 by Toyol on Tuesday, 28 October 2008 - 9:08 am

    M’sia has no pension funds for the private sector and the EPF is the only source of income for most of the working class. We need this money to survive the many years after retirement as well as to fund our children’s studies. By raiding the EPF, the govt is denying the 12 million voters the right to a decent living after retirement as well as depriving their children to a decent education. This is NOT a govt that cares but a robber govt!

  105. #105 by lextcs on Tuesday, 28 October 2008 - 12:35 pm

    worldwide every country is trying to stop the selling mess….with epf and valuecap around at least it will provide some stability and mob up all those cheap shares…..who else but them? DAP is dont even have to money to buy its own building let alone guard national interest….what happened to anwar rm 3 trillion warchest?…im sure now wolfowitz is minding his own bizness first.

  106. #106 by son of perpaduan on Tuesday, 28 October 2008 - 1:32 pm

    Umno people is doing the right thing at the right time by pumping another 5 billion into ValueCap from rakyat hard earn money. If they dont do it now,when? not a chance if they are no longer in power, just like george bush pump in USD 700 billion of tax payer money before his term as president expire. Think…..how much he will benefited from this huge amount? Umno will try they very best to dry clean rakyat money before it is too late. BN days in administer the country will soon finish, by the time PR take over the goverment…treasury no more money same as mahathir handing over the premiership to badawi.

  107. #107 by son of perpaduan on Tuesday, 28 October 2008 - 1:37 pm

    12 million of EPF contributer vote is more than enough to kick this corrupted goverment out of power. Please exercise your rights.

  108. #108 by Nudibranch on Monday, 3 November 2008 - 5:36 pm

    Question marks over Valuecap debt

    KUALA LUMPUR, Nov 3 — State investment company Valuecap Sdn Bhd owes its three shareholders RM5.1 billion, which is due to be repaid in February 2009.

    This debt, in the form of interest-bearing unsecured bonds, raises questions over plans for the Employees Provident Fund to lend RM5 billion to Valuecap to invest in the stock market.

    In March 2003, Valuecap borrowed RM5.1 billion from shareholders Khazanah, Kumpulan Wang Amanah Pencen and Permodalan Nasional Bhd to invest in the stock market. At the time, world stock markets were bracing for a looming war in Iraq which followed on the September 2001 attacks on the US.

    Valuecap’s bonds were due to be repaid in February 2006, but the company was given another three years to this coming February. At the end of 2006, the three shareholders each held RM1.7 billion in these bonds, according to documents obtained by The Malaysian Insider.

    Since these debt instruments were not listed and are not tradeable, the three shareholders are probably still holding these bonds today.

    Recently, the government proposed that EPF lend Valuecap RM5 billion to invest in the stock market. In view of its impending obligation to repay its shareholders, however, questions arise over whether the loaned funds will be used to redeem the bonds.

    As at the end of 2006, Valuecap’s investments were valued at RM4.8 billion. Since then, the stock market has lost 21 per cent of its value. If Valuecap’s investments have tracked the stock market, these could be worth RM3.8 billion currently.

    Pls stop this loan……. !!!!!!!!!!!!

  109. #109 by ktteokt on Wednesday, 5 November 2008 - 10:06 am

    Valuecap or FRENCHCAP, this is a gimmick by the BN government to rob the people of their hard-earned savings!

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