This article first appeared in The Edge Financial Daily on September 20, 2018
Attorney-General (AG) Tommy Thomas originally thought he would spend about an hour taking questions from The Edge Financial Daily (TEFD) and Malaysiakini last Thursday, when met for a joint interview in his office in Putrajaya.
But the allotted hour soon stretched to an hour and 40 minutes as the AG revealed, in his first interview since his appointment in June, the "mind-boggling" number of lopsided contracts the previous government had committed to because “all the ministries were doing it”, his thoughts on Finance Minister Lim Guan Eng’s acquittal and the charges brought against prominent lawyer Tan Sri Dr Muhammad Shafee Abdullah, and more.
Below is the second and final part of excerpts drawn from the interview, which was attended by Ho Kay Tat, Tan Choe Choe and S Kanagaraju from TEFD.
Q: Are you making progress with reforms? All the headlines so far have been on 1MDB (1Malaysia Development Bhd) and little have been about reforms.
A: Yes, as to law reform, the AGC (Attorney-General’s Chambers) has prepared a list of the promises that PH (Pakatan Harapan) made in the manifesto. The list for law reforms runs to nine pages — so many Acts are mentioned. It is just an unbelievably tall order. And it’s understandable because they are trying to clean up after 60 years of one coalition’s repressive laws. Looking at this law reform list in the manifesto, the process may take as long as a decade!
Q: What would be your priority?
A: Let me explain. First of all, you need parliamentary time. Parliament must sit longer and give more time for lawmaking. Parliament has many functions — debates, questioning and so on, but also lawmaking. I have told some stakeholders: Please prepare your own bills. So if a women’s organisation has complaints, it should prepare its own bill. If the lawyers, the engineers, the business community, or whatever, likewise; it’s easier because they know their problems. They can give us their draft laws; whether we accept them is something else. But if they give it to us, it’s faster; it speeds up the process of law reform. For example, the repeal of the Anti-Fake News Act (which is in the news again), it was done by [Communications and Multimedia Minister] Gobind [Singh Deo’s] ministry very quickly, and then sent to us. [Replacing] the GST (goods and services tax) — which is made up of five or six laws — was also done incredibly quickly, coming out of MoF (finance ministry) to our parliamentary draftsman.
Q: On the Anti-Fake News Act, a BN (Barisan Nasional) senator explained that the repeal was blocked on the grounds that the law was relevant and should be improved [and not abolished]. Will it be given a second chance to be passed?
A: Under our Federal Constitution, you can’t do anything for one year.
Q: Let’s say an IP (investigation paper) comes to you. Say, the police want to take action against somebody based on this. Are you going to take action?
A: I don’t want to foreclose my discretion if that occurs in the future. But I would be reluctant. I don’t think anyone in the AGC supports it. But it puts us in a difficult position because unfortunately it is still a law on the statue books. So it still forms part of the laws of Malaysia, and one has to respect our laws. Hence, an unsatisfactory position!
Q: After one year?
A: After that, it has to be re-presented to Dewan Rakyat, and Dewan Rakyat has to pass it again. Then it goes back to Dewan Negara, and then they don’t have a say. If they don’t pass it, it will be passed directly to His Majesty, the Agong. But there’s a one-year cooling-off period.
Q: What’s the status in terms of repeal/amendment [of laws like] the OSA (Official Secrets Act), Sedition Act, Printing Presses and Publications Act, the UUCA (Universities and University Colleges Act)?
A: The ministries must help out. Ministers must push their respective ministries. Let’s take the Universities and University Colleges Act — that’s under [the] education [ministry] I assume. What we would really want to speed up the process is for the education minister to push his ministry and his legal advisers to prepare amendments and pass them to us. Our parliamentary draftsman will have the final say. The reason I say this is because as the stakeholders, that ministry will presumably know more about universities and colleges than anybody else. The lawyers in our office are just specialists at drafting, but the subject matter or the content of an Act is something that different people would know more of. If there are any health/hospitals-related bills, then it’s better for the health ministry, and so on.
Q: The ministries should drive the changes?
A: Yes, that’s right. Take ownership. Because no one person can do it on his own. My task would be to encourage it, and to facilitate it. Because historically [the AG’s] Chambers has had a reputation, rightly or wrongly, as acting as a brake against law reform. We are now going to say, look, we support law reform; we will facilitate it. But to expect us to draft all this, that is not possible because we don’t know all the problems. Like, for example, the press. Why can’t the press, if you have a press association, why don’t you come and see the right ministry and say, “Look, this is our version of the new press act,” or whatever. They may or may not agree, but they will say, “Thank you very much.” It speeds things up. That way also, the more the stakeholders there are who are involved.
Q: You said the list itself is a tall order. Are any going to be prioritised? For instance, the Sedition Act is still being used.
A: The Sedition Act is more complicated. It requires constitutional amendment because one of the sections in the Act prohibits criticisms against the Rulers — what is regarded as the privileges of the Conference of Rulers. They have to approve. But the others like [the] Prevention of Crime Act, NSC (National Security Council Act), Sosma (Security Offences [Special Measures] Act), Printing Presses [and Publications Act], Peaceful Assembly [Act] are easier to handle. Also, the Institutional Reform Committee has done a remarkable job and presented their views to the PM (prime minister). That is also a source.
Q: What about the political financing bill?
A: That’s on the way, but I don’t know which ministry is doing the first draft. The AGC has advised that as a matter of law there is no legal prohibition to such a new law. It’s a question of being creative about it. All the political parties must be governed by the same rules. The objective would be to regularise financing and donations, and to have open disclosure. I don’t know if they want to have a limit on donations. It is basically to recognise that elections can only be held through contributions to political parties and candidates, and it is healthy to accept that this happens. It is the same in other countries.
Q: The PM has spoken over and over again about lopsided contracts. You are quite an expert in commercial litigation and contracts. Maybe you can share some aspects or some examples, and whether these lopsided contracts can be renegotiated to reduce the financial damage to Malaysia or it’s something that’s totally out of our hands, and we have to deal with and pay the compensation.
A: There are different types of such contracts. Again, the problem is much worse than I thought. As somebody outside following public affairs, one was aware of one-sided contracts, starting with road concessionaires, power plants and the like. But once I’ve come in, I have seen literally hundreds of such contracts. Let’s divide them into external and internal contracts.
External, you have got Singapore and the HSR (high-speed rail). Whether it’s fair or not, may be a matter of discussion, but I won’t say it’s a lopsided contract. We did well and Singapore was generous by agreeing to the suspension even though the contract did not provide for it. Hence, it constituted a variation of the original contract, which Singapore agreed to. That speaks well for good Causeway relations. That is the HSR.
Then there’s China. The PM was outstanding. Not many foreign leaders have gone to China and persuaded China to vary its contracts. The PM convinced the president and PM of China. The problem is we have now to look at the consequences of the termination, even if it is a mutual termination by China and Malaysia of these contracts. We have to start hard bargaining on the effects and consequences of mutual termination. That’s a tough proposition. We’re forming teams to prepare for them.
Q: How long will that take?
A: Hopefully not too long. A lot of money is at stake, and loans are involved. We have already told China we are ready to negotiate!
Internally, there are hundreds of such contracts. What we didn’t realise is the number involved. We have highway contracts, services contracts, private finance which are build-lease-maintain-and-transfer (46 of them), ports, etc. Many categories — there are over 350 contracts of that nature. Also procurement contracts — we just drew a line in the review on the value — and that’s over 300 such contracts. The number is just mind-boggling. All the ministries were doing it. Again, we have a very strong contracts review team and they are reviewing these contracts.
Q: Just within the AGC? No external help?
A: Yes, within [the AG’s] Chambers: we don’t need external help. Some of these AGC members were very unhappy because when they objected to these lopsided contracts prior to their execution, they were overruled by their former political masters, that is, ministers. They are unsung heroes. They are civil servants, and the previous PM and the MoF just brushed them aside. They are therefore familiar with these contracts. But the trouble is that these contracts have clauses that are very favourable to the counterparties, and unfavourable to the government. We are trying to be creative and imaginative. At least two or three times a week, I spend hours with the contracts review lawyers. My corporate commercial litigation experience is combined with the draftsmen and technical advisers in Chambers.
Q: If you are able to achieve some success, it’s a lot of financial savings, right? Ultimately it’s about dollars and cents.
A: Absolutely. Like China, we’ll have big savings. Singapore is not so much savings as being deferred. That’s the objective of the exercise; the objective is to reduce overpayments.
Let me give you an example of a typical PFI (private finance initiative). The orthodox way of doing such business would be for the government, as an employer, to ask the private sector, hopefully through tender, but there were no tenders, to build, say, a university. The government, as an employer, uses the land belonging to it and asks, let’s say, XYZ Sdn Bhd to build the university in, say, three years. The cost is RM350 million, over a three-year period. Just like you are building a house, so payment will be against the architect’s certificate — progressively. So after three years, XYZ goes away and receives payment of RM350 million, and we receive the university built for us on our land. Then the university opens its doors, and students come in. That’s how it ought to be.
But under this build-lease-maintain-and-transfer PFI, you have the construction of the university, but you also have a 22-year contract where the government must continue paying for maintenance and other kinds of charges, which are just absolutely ludicrous and do not make any commercial sense. The effect of it is that the government (taxpayers) have to pay literally three times more. So in the RM350 million example, taxpayers pay RM1.1 billion over 22 years, as opposed to RM350 million over three years. As the PM has said many times, “Whoever did these stupid contracts?” That gives an innocent interpretation. There are more sinister interpretations, which you can draw!
Q: To clarify on the Chinese deals that have been terminated, what is the total figure now we have to bargain down from?
A: I think the press statements suggest RM100 billion or so.
Q: That RM100 billion will be the total cost of the project if it goes on, which includes interest payment on the loan and all that. The actual value is about RM55 million to RM60 billion for just the ECRL (East Coast Rail Link), but if you put in the interest that has to be paid over the years, it adds up to RM100 billion plus.
A: It is misleading to say it’s RM55 billion for the ECRL because the people who signed those contracts were the same people who signed the loan agreements with China because we do not have the money to build. Hence, we borrowed from China. So you have to look at the loan agreements, and the loan payments, and the true cost of the project is RM100 billion. It is dishonest to say it is RM55 billion, when it will cost the taxpayers RM100 billion after the loans are repaid. That represents the true cost of the rail project.
Q: I think what the taxpayers would be interested to know now is what’s the cost of compensation? It was reported the compensation for the ECRL could be about RM22 billion.
A: It’s too early, we have not gone into negotiation. From our point of view, we do not want to pay anything. We should start negotiating from that point.
Lim Guan Eng
Q: Do you want to respond to comments from MACC (Malaysian Anti-Corruption Commission) that they were not satisfied when the AG’s Chambers dropped the case against [Finance Minister] Lim Guan Eng?
A: I think what must not be forgotten is that the AGC did not hide behind the constitutional and legal position in Malaysia from Merdeka, that the AG, as public prosecutor, does not have to explain, or give reasons for a decision to prosecute or to withdraw charges. And there’s a long line of cases for 50 years stating just that. They have always said they do not have to give an explanation. But that is one of the reasons why in the past the AGC was much criticised, especially in the run-up to GE14 (14th general election) — I was conscious of that past. Therefore, although there is no legal or constitutional obligation for the public prosecutor to explain why it did not wish to continue with the prosecution against Lim Guan Eng, we nevertheless offered it. Instead of being credited for his openness, [Datuk Mohamad] Hanafiah [Zakariah] (the deputy public prosecutor [DPP] in charge) was criticised for his lengthy explanation. This is probably the first time since Merdeka that a prosecutor has explained his decision.
In so far as my personal involvement is concerned, I cannot understand why some do not seem to understand conflict of interest and recusal. Probably the world’s most influential or well-known AG is Jeff Sessions of the US. Within a week of his appointment, he recused himself from the Russian investigation. You cannot turn on CNN for the past one and a half years without listening to President [Donald] Trump complaining about Session’s recusal.
In his case, it was also because of conflict of interest. So what I was doing was just following a well-established principle of common law of about 300 to 400 years history, that you must not act when you are conflicted. If you are a private practitioner, you may have many friends and persons you acted for. Thus, from the time I entered office, any decision concerning Lim Guan Eng is not taken by me personally, just like Jeff Sessions does not act personally. But it doesn’t render the DoJ (US Department of Justice] or the AGC helpless and powerless. We have got 545 DPPs, and they make decisions daily. And Hanafiah is a very senior DPP. Hanafiah’s decision in this case represents the decision of the public prosecutor.
Q: And you support that?
A: My position does not matter. If one recuses oneself, one just has no say in the matter. You remain recused, from the beginning until the end of the decision-making process.
Q: There has been criticisms that MACC should be consulted, that the DPP — Datuk Masri Mohd Daud — who’s charging or handling the case should be consulted . At the time, I understand that they were not consulted at all, until about 7.15am.
A: That is the prerogative of Hanafiah as the relevant decision maker. It is up to him. He doesn’t have to consult anybody or keep anyone informed. I believed he explained, in his statement, that he was concerned it would be leaked.
Q: The death penalty, what’s the status of that? There’s some pressure to do away with it.
A: It is in the [Pakatan] Harapan manifesto. It’s going to happen. The good news is that senior officers from the prison department informed me that they are against carrying out death sentences on prisoners on death row. Chambers is also against it. Therefore, no one should be hanged until the new law is enacted.
Q: What about the issue of separating prosecution powers and the fact that you are a legal officer of the government?
A: We all support that. A constitutional amendment is however required. The Institutional Reform Committee also supports the separation. So no one is against it. It is thus a matter of political calculation: Can the government secure the necessary two-thirds majority in Parliament to do it?
Q: How about the criticisms that you’re dropping charges against [lawyer N] Surendran, [cartoonist] Zunar, etc? It was done quickly and some people are questioning the motives behind these charges being dropped so suddenly. Do you want to respond to these criticisms?
A: They were all politically motivated charges. The right question that should be asked is — and it applies to Lim Guan Eng also — why were these people charged in the first place? I inherited a massive problem. In the past three months, my office — and about 90% of these are addressed to me personally — received about 300 to 400 written representations from lawyers and members of the public. All those representations relate to decisions made by my predecessors. So the relevant question should be, why did they make those decisions, which require me to look at them? So whatever decisions we make in a particular case — in a sense it’s like the Court of Appeal — I will be criticised. But coming back to these examples, they were politically motivated prosecutions. But one thing you can be assured of, I will never charge anyone for political reasons. That I assure you.
Q: When you took up this job, did you expect the kind of criticisms you are getting, the kind of brickbats you have received?
A: Yes, and no. I’m surprised by some of the criticisms. The previous AGs were criticised, perhaps more by the [Malaysian] Bar at their general meetings. I myself have spoken at such meetings of the Bar, where to the best of my memory, all the AGs in the past 50 years have been criticised by the Bar. They haven’t done that so far to me, but that cannot be ruled out. In my case, it seems to be relentless and unremitting from members of the public. I guess if you compare, I may have received more criticisms in three months than my predecessor did in three years! [Laughs] But that’s part of the job, and I can smile about it. When vested interests are threatened by reform-minded measures, it is inevitable that a backlash would result.
Q: Not being of the expected ethnic or religious group, does it make your job harder in any way?
A: Not really. The law is intended to be race-free and religion-free. Everyone in the [AG’s] Chambers seem to behave that way. They don’t bring race and religion into their decision-making process, so that’s not a problem, really. And I certainly do not. Those who wish to criticise me for ethnic reasons will continue to do so.
Q: Since [lawyer Tan Sri Muhammad] Shafee [Abdullah] has been charged, do you want to respond to questions which may be raised: Now that [former prime minister Datuk Seri] Najib [Razak’s] lawyer has been charged, this is to prevent Najib from getting true justice?
A: The answer to that is an accused’s lawyer cannot say, “Please do not charge me; I enjoy legal immunity that nobody else in Malaysia does.” All of us from the PM down are under the law; we don’t enjoy immunity. An accused lawyer cannot say, “Please do not charge me because if you charge me, some of my clients will not have a lawyer of their choice, or they will have problems finding a replacement lawyer”. That is absolutely irrelevant and unacceptable. The law must take its course, regardless of consequences.
Q: I think the criticism is coming from the point of view that the charging came immediately or days after he made the revelation that [Prime Minister] Tun [Dr Mahathir Mohamad] was the one who pushed for his appointment. I think people are connecting the dots, that probably the instruction came from somewhere else.
A: The PM did not know of the charges against Shafee because I did not brief Tun about them. It was absolutely my decision.
Q: About the public caning in Terengganu. It’s unconstitutional as it is not being done in prison, caning of women and all that. In this kind of situation, as a legal adviser to the government, do you have a duty to inform the government that it’s unconstitutional?
A: It’s not so easy because syariah is a state matter and the Sultan of Terengganu is the head of religion in that state. It’s not so clear. It’s one of those areas where there is tension between the federal jurisdiction on criminal law, and syariah law which is state law. Furthermore, these are sensitive, delicate matters that must be approached prudently. But I think the caning has started a debate, which is encouraging.
Q: It needs a political solution.
A: Yes, but again not so easy.
Q: Should your position as AG be an elected position? Should you be answerable to Parliament? What are your thoughts on that?
A: Actually, we have thought about it before. We looked at what happened in the UK, which has changed its policy. The least-worst option is to have a career lawyer who is sympathetic to the government because he or she has to carry out the government’s mandate, but who is well recognised in some branches of the law — you can’t be in all branches of the law — who enjoys a reputation in the Bar and the Bench. Thus, a full-time legal adviser is better than a politician AG.
As to being answerable to Parliament, one cannot give reasons even if one is a member of parliament (MP), on many of these matters. You cannot give reasons if somebody asks you, “Why did you prosecute Mr A?” And the next day, “Why did you not prosecute Mr X?” or “Why did you choose to charge this under Act A as opposed to Act B?” You cannot answer those questions because some of them are highly confidential. I would say what Hanafiah disclosed in his six-page statement is as good as you can get from any AG in the world. So it does not matter whether an AG is a MP for accountability and transparency to occur.
Q: The statement you issued when you appointed [senior lawyer Datuk] Sulaiman [Abdullah] and [retired Federal Court judge Datuk Seri Gopal] Sri Ram was unexpectedly candid. But to your detractors, they’d happily see it as proof that you can’t really cope with the demands of your job. What do you say to that?
A: I rather be frank and truthful.
Q: And the job has evolved?
A: The legal world has changed remarkably and the problems are much graver today. If we look at common law jurisdictions — there are very few, if any, where the AG goes to court anymore. It is just not possible. I think that’s reality.
Q: You said you have not received any IPs on 1MDB, but given the scale and the many transactions, wouldn’t it be fair to say that there will be quite a number of prosecutions in the end?
A: Yes, definitely. Absolutely.
Q: Are you aware of any state witness? Anyone?
A: No, because they’re still investigating; we won’t know. Whether the MACC or police is talking to Mr X or Mr Y and asking them to turn state’s evidence or Queen’s evidence against any target, I don’t know. It may come later.
Q: So Sri Ram and Sulaiman will have their hands full?
A: Sulaiman has only one trial — SRC [International Sdn Bhd] — and he has five months to prepare and work with my team. That’s just one case. Sri Ram is to push 1MDB and perhaps argue in court for two of those cases. Sri Ram will handle the prosecution of Shafee, and probably the first of the 1MDB cases. They’re heavy trials, so we’ll have to find somebody else for other cases. That’s why the task is awesome. You can expect about five to six different 1MDB prosecutions, against like the board, the Good Star [Ltd] phase, the Tanore [Finance Corp] phase, the IPIC (International Petroleum Investment Co) phase, all of which you are familiar with. We would have to find a team for each different case. Sri Ram would be asking for December trial dates in the Shafee case, and Sulaiman has a February trial date (for the SRC case against Najib).
Q: You gave yourself two years when you took up this job. Just two years, that’s it?
A: [Laughs] I’d be burnt out by then, it’s long hours. I’m fit and fresh now because I know there’s a finishing line. So I’m happy to work hard for one year and nine months more!
Q: Is there more pressure on you when Dr Mahathir said there’d be more charges on Najib?
A: People have asked me that over and over again. My answer always has been that when it comes to 1MDB, all the 30 million Malaysians should be concerned, and talk about it because it affects their pockets for the next 20 to 30 years. It actually affects their pockets. I think people across the world should also talk about it because it tells you how dishonest politicians and businessmen can cheat a nation. So I’m all for a full public discussion. But this debate does not influence my decision-making.
Q: Are you getting pressure from the public?
A: Most are nice and supportive. They understand. Whenever they see me, they tell me I represent reforms, which they support. They say I am the face of reform.
I’ve said I don’t want people to be afraid in Malaysia. The fear element must disappear. Much of the fear element emanated from the office of the AGC. The AGC must no longer be associated with fear. We are, at the end of the day, 1,200 lawyers and the support staff, who must all believe in and practise the rule of law. That doctrine encompasses a large number of concepts, including free speech, due process and so on. The AGC must believe in them.
Q: You said people perceive you as the face of reform. Does that burden you?
A: I won’t say burden. It’s just very high expectations. I just want to fulfil it. I hope I can live up to them. I won’t see it as additional pressure. I really do not want to disappoint them.