I refer to the statements by Dr Jeyakumar Devaraj, Chairman of PSM (Parti Sosialis Malaysia) and Galen Centre for Health and Social Policy CEO Azrul Mohd Khalib with regards to mySalam.
At the onset of the birth of mySalam, I have written several articles and also read about the political risk of MySalam to the PH (Pakatan Harapan) government. The issue raised by both writers has merit. It also raised the issue of governance and transparency practiced by MOF (Ministry of Finance) and BNM (Bank Negara Malaysia).
To recap, the policy issued by BNM on the limiting foreign shareholding of foreign insurance companies, where they are required to dispose 30 per cent of their shareholdings to domestic players by 2017.
This affects not only GE (Great Eastern) but also several other insurance companies. BNM has been weak in their approach and has failed to get the companies to comply.
As for GE Malaysia, they struck a deal with BNM where they are allowed to retain the 100 per cent in exchange of paying BNM RM2 billion, which is derived from the value of profit forecast for the next 10 years.
As a nation, the people have been shortchanged with the deal. BNM and MOF have hoodwinked the public on this. There has been no money transferred outright, but about RM400 million is allocated annually by GE to support the critical illness insurance scheme for the B40 where they also earned administrative fees.
It is not clear whether there is any sharing of the surplus from the technical results between GE and the trust fund.
BNM’s failure to get GE and other foreign companies to share their shareholding means that it reduces the economic multiplier potential for the nation.
Many governments in the region actually insisted that foreign companies list their shareholding on their domestic bourses. This should be the route that BNM should have taken, instead of making a deal with GE that benefits GE largely. BNM’s and MOF’s deals in secrecy with GE have shortchanged the people.
Until today, BNM has not provided a clear explanation why GE has the exclusive right to the mySalam program and there was no tender among the industry players?
In reality, the RM2 billion deal is a lousy deal for Malaysian taxpayers; it does not create wealth among Malaysian. It has zero economic multipliers value. This is a question that BNM and MOF must answer to the Malaysian public.
Had the RM2 billion been allocated as seed funding for the National Health Care Financing Scheme, it would have benefited millions and would have put MOH on a startup footing to develop the National Health Insurance programme.
Before the money runs out, I urge MOF and BNM and various stakeholders to review what has been done and do the right thing for the people and the national economy.
This can be the most dangerous political hot potato in the next few years which can bring down a government.
Dr Mohamed Rafick Khan is a reader of CodeBlue.
- This is the personal opinion of the writer or publication and does not necessarily represent the views of CodeBlue.