Guan Eng wants bipartisan review of IPPs

By Yow Hong Chieh
June 13, 2011
The Malaysian Insider

KUALA LUMPUR, June 13 — The government must convene a panel comprising both Barisan Nasional (BN) and opposition lawmakers to ensure there is no cover-up of “lopsided” independent power producers (IPPs) deals, Lim Guan Eng has said.

The DAP secretary-general said only a bipartisan committee or royal commission of inquiry (RCI) into the hot-button purchasing power agreements (PPAs) would assure the public they will not lose out if the deals are eventually renegotiated.

He said the people were sceptical of the current Cabinet committee review into the PPAs as no action had been taken against politically-connected Umno and BN leaders who allegedly profited from the RM52 billion Bumiputera shares scandal.

“For this reason Prime Minister Datuk Seri Najib Razak’s assurances that his government will not look after the interests of IPPs but will side with the people sounds hollow and unconvincing,” Lim (picture) said in a statement today.

The Najib administration announced yesterday that it has formed a special Cabinet committee to evaluate PPAs in light of growing resentment on the ground following a seven per cent power rate hike two weeks ago.

Datuk Seri Ahmad Husni Hanadzlah said the committee will not only study the IPP “problem” but production costs and requirements for the future in light of IPPs whose concession will end in 2014 and 2015.

The second finance minister also stressed that the Cabinet panel will take a bird’s-eye view of subsidies and not be focussed primarily on the power deals or producers.

“We have not been given any deadline for submitting the report, but what must be stressed here is that it will give priority to the interests of the people,” he said.

The Cabinet raised power tariffs by an average of 7.12 per cent effective June 1 in a bid to trim a growing subsidy bill and widening fiscal deficit but the move has also thrown the spotlight on the PPAs TNB inked with IPPs.

Opposition lawmakers have rounded on the Najib administration for wielding the knife on consumer aid while leaving gas subsidies to power producers — to the tune of RM19 billion this year — largely untouched.

The PPAs between TNB and the various IPPs are classified under the Official Secrets Act (OSA).

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