PETALING JAYA: The Government will amend the Bankruptcy Act 1967 to bar bankrupt civil servants from remaining in office, said Minister in the Prime Minister’s Department Datuk Seri Dr Rais Yatim.
Currently, under Section 36 of the Act, the disqualification only applies to Sessions Court judges and magistrates and those nominated or elected to or holding or exercising the office of a councillor of a local authority.
Dr Rais said the provision needed a closer look to embrace all public servants and the ministry’s legal department had been instructed to study the matter.
“It is a public policy that a bankrupt should not serve in the public office. This is due to the pecuniary indebtedness position one is in,” he said in a telephone interview.
Dr Rais was responding to a report that the Jasin district council secretary, Abdul Manaf Jaffar, had had his contract renewed on Jan 1 this year although he had been declared a bankrupt three months earlier.
Malacca Chief Minister Datuk Seri Mohd Ali Rustam had said that there was nothing wrong in a bankrupt holding the post as no rules had been broken. He added that the Official Assignee had also not stated that Abdul Manaf could not hold the post.
Dr Rais said Abdul Manaf’s case was covered under Section 36 of the Bankruptcy Act because he was nominated to the post.
“Some people may split hairs over the fact that he is not a councillor but just a contract secretary. However, the key word is that he is nominated to the office of a local authority and he forms part of the council administrative structure.”
When asked to comment on the amendment to the Bankruptcy Act, Cuepacs adviser Datuk N. Siva Subramaniam said it would be unfair to dismiss all public servants who were declared bankrupts.
“Some became bankrupts not by their own fault but because of being guarantors for loans taken by others.
“The current regulations that allow disciplinary action based on the merit of the case is sufficient to deal with the situation,” he said when contacted.
Siva Subramaniam said the proposed compulsory dismissal for bankrupt public servants could push hard pressed civil servants to the edge and seek help from loan sharks instead.
“This will open the opportunity for loan sharks to threaten civil servants,” he added.
In Malacca, Mohd Ali said he would submit a report to Prime Minister Datuk Seri Abdullah Ahmad Badawi this week on the matter.
“I will abide by any advice given by the Prime Minister,” he added, saying the state government was ready to rescind Abdul Manaf’s contract.
Abdul Manaf, 47, was declared a bankrupt on Sept 11 last year for standing as a guarantor for a company over a RM2.5mil loan.
He said yesterday that he had nothing to hide.
“I am not a criminal. Everyone in the council and my friends know that I am a bankrupt. I am also a victim here,” said the former Jasin Umno committee member.
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