MCA: Is Selangor govt heading towards bankruptcy following SPLASH lawsuit?

PETALING JAYA: MCA has questioned whether the Selangor state government is on the verge of bankruptcy after Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (SPLASH) filed a suit against Syarikat Bekalan Air Selangor Sdn Bhd (Syabas) to claim RM4.22bil in outstanding receivables.

"If the Selangor government loses this RM4.22bil suit, payment of these outstanding bills will completely wipe out our state reserves of RM3bil and leave us in a negative position," Petaling Jaya Utara MCA division chairman Tan Gim Tuan (pic) said in a statement Friday (April 13).

Shortly after Air Selangor acquired the other water companies (Syabas, Puncak Niaga Sdn Bhd and Konsortium Abass Sdn Bhd) in 2016, Syabas under its new administration proceeded to reduce payments to SPLASH to only about 36% of billings.

Tan claimed that since the Selangor government took over Syabas, the company had been reporting "massive annual losses every year".

"A check with the Companies Commission of Malaysia (SSM) shows that for the latest financial year ending Dec 31, 2016 and tabled on May 30, 2017, Syabas registered a net loss for the year of RM1.19bil out of a revenue of RM1.87bil," he added.

He also said the Auditor-General's Report for 2016 revealed that when Datuk Seri Azmin Ali became Menteri Besar, the Selangor state government had posted deficits compared to the time of his predecessor Tan Sri Khalid Ibrahim.

"As a citizen of Selangor, I note with increasing concern that the Selangor government had kept completely silent that Syabas has been sued for RM4.22bil for unpaid bills.

"We would also want to know why Syabas only paid 36% of its bills instead of the full amount as what the ordinary rakyat does," he said.

Tan added that the state government cannot afford to have its reserves wiped out as it had just signed on a RM9.65bil loan three years ago.