KUALA LUMPUR: Lembaga Tabung Haji had since 2014 illegally issued hibah (dividends) to its depositors despite showing a deficit in its accounts.
An audit carried out by PricewaterhouseCoopers (PwC) showed that as of Dec 31, 2017, TH has total assets of RM70.3 billion, with total liabilities of RM74.4billion, indicating a deficit of RM4.1 billion.
Minister in the Prime Minister’s Department Datuk Seri Dr Mujahid Yusof said according to Section 22(3)(a) of Tabung Haji Act 1995, TH can only issue dividends if its fulfils two criteria.
“The Act is clear on the payment of hibah, where two conditions must be satisfied before payment of hibah can be made; the assets cannot be lower than its liabilities, and there must be distributable profits.
“TH’s act of declaring hibah since 2014 was not in accordance with the Act, because its assets have been lower than its liabilities,” he told a press conference in Parliament on Monday.
Mujahid said, given TH’s current financial situation, a comprehensive turnaround plan is ongoing.
“In view of the current situation of TH, a comprehensive turnaround plan is needed to restore its balance sheet. That is precisely what the new team has done.
“Under the turnaround plan, they (TH management) have recommended the setting up of a Special Purpose Vehicle (SPV) to take over, rehabilitate and maximise recovery of TH’s under-performing assets, including selling related assets.
“The Cabinet had discussed the turnaround plan thoroughly and given our full support and endorsement to the plan, so that TH’s financial position can be regularised and restore the rakyat’s confidence.
“To ensure the long-term sustainability and resilience of TH, the government has decided to place it under the supervision of Bank Negara Malaysia administratively, from January 1, 2019,” he said.
Mujahid also said he was confident that TH would be able to pay out dividends for 2018, based on the restructuring plan. However, he said the amount has yet to be decided upon as TH has yet to close its accounts for the year and that it would depend on the profits.
He also said the cost of performing the Haj for pilgrims would remain unchanged at RM9,980 per person.
On possible action to be taken against the previous TH management, he said that would be dealt with soon.
“Since 2014, TH has been issuing hibah without meeting the two conditions. So, where did they get the money? I leave that to you.
“That will be dealt with later,” he said.
Reports by: Nor Ain Mohamed Radhi, Mohd Iskandar Ibrahim and Ahmad Suhael Adnan