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GLCs: Downsizing or closure
Published on: Tuesday, March 26, 2019
By: Larry Ralon

KOTA KINABALU: The State Government has no immediate plans to privatise any government-linked company, but may downsize or close those that are non-performing, continue to incur losses or have become irrelevant.   

“We have yet to go into that, privatisation is one of the areas. But what is important is to streamline the direction of the economy of the State where GLCs do not play the intended role. 

“For those who have done something not in tandem we have to correct that,” he said, after attending the Sabah Forum on Institutional Governance and GLC Reforms at Wisma Sedia, Monday. On downsizing GLCs, Mohd Shafie who is also State Finance Minister, said he has identified several GLCs, including those under Sabah Foundation, which may be closed down.   

“Indeed we know there are several GLCs which are not proactive and continue to incur losses for nearly three years. The operating costs are too high. There are also agencies which have no roles.  

“I have identified several. There are three which I asked Sabah Foundation Board to close down but all the employees were not terminated. 

“Instead, they must be absorbed into other areas where their services are needed. Because other agencies under the foundation are also in need of manpower.  

On corruption in state GLCs, Mohd Shafie said the State Government has started with the Sabah Foundation and those in the timber industry. “Banning log exports is one where we can make sure there is no corruption or leakages along the way, that we can monitor at the port level.  

“Because any logs coming out from the State through the port, we’ll be able to realise that. And there should not be any chopping of trees. That’s why I already informed the enforcement unit to ensure we must beef up our outfit.  

“Similarly with other efforts, for example, the State Water Department when we stopped the concessions for outsourcing water.  

“It should not be given to any business entity but let the Government department operate so it will be directly under the department itself.  

“You can imagine how much savings we realised. The 1,300 personnel working with the outsource companies, we absorbed into the State Water Department.”

“I have spoken many times to colleagues in the State Cabinet, it starts not only from the top, but also among the civil servants including those in the GLCs, which are entrusted to become a platform to enable us to play a very active role in realising the economy, providing employment opportunities and for development purposes.  

“But sometimes we can see there are GLCs veering off its tracks. There are those involved in issues like we have said, corruption, at various levels.  We must learn from what happened to Tabung Haji, Felda and so on, to prevent it from happening in our state GLCs like Sabah Land Development Board (SLDB), Sabah Foundation, Sawit Kinabalu and so on.”

Mohd Shafie said he wants to return the state GLCs, like Sabah Foundation, Sawit Kinabalu to the real intentions they were  created.  

“The GLCs are meant for developing and generating the State’s economy. During this ever-challenging economic condition, we want our government machinery to play a more active and pivotal role.”           

He also said the government will form relevant bodies such as a Sabah Marketing Board to assist in bringing products from villages to consumers.

“We know that a lot of commodities like produce in Ranau goes to waste because it does not reach the end market due to a breakdown in connectivity. We need to ensure that there is connectivity between the production and the GLC’s role is to help develop and boost the economy.

“In such challenging economic times, the government plays an even more pivotal role in managing the economy so we don’t want any leakages or corruption,” he said.



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