Keeping stakeholders’ interests at heart
TABUNG HAJI:
CEO says the fund will add value to haj packages while keeping them affordable
AS the only governmentlinked investment company (GLIC) of its kind in the world, Lembaga Tabung Haji (TH) has kept its stakeholders’ interests at heart as it grew over the last 53 years to record RM65 billion in funds contributed by close to nine million members.
TH group managing director and chief executive officer Datuk Johan Abdullah said the fund’s operations — from deposits to haj pilgrim selection, investments and acquisitions — are conducted with due diligence, processes, and as prescribed under the law.
“We cannot run away from the very objective of TH, which is to ensure that the depositors would have sufficient funds to perform the haj,” said Johan, who was appointed to helm TH effective July 1.
Haj payment has also been maintained in recent years at RM9,980 per person despite rising costs. The total subsidy for last year’s haj season was RM126 million, up from RM106 million in 2014.
In a one-hour exclusive interview with the Media Prima group, Johan said TH would strive to keep haj payment affordable while upgrading its service and adding value to the pilgrimage package.
“Last year, we created an out-ofthe-box idea for pilgrims with fragile health, which we named Safari Wukuf, where we provide air-conditioned buses for them as it is a bit taxing to go to Arafah in the heat.”
The former banker said TH operated differently from an Islamic bank, which received deposits and used them to invest or provide loans.
“Even though we operate savings accounts, the model that we adopted under the Tabung Haji Act 1995 is investment, which means that we are exposed to the ups and downs of the economic condition as well as the market outlook.
“With the investment, we have a strategy in terms of asset allocation. We spread out the risk where we have investments in equity, fixed income, and in other strategic sectors such as property and plantation.
“The generation of income and returns from there, minus our cost, will be the portion that we will distribute to the depositors.”
On regulatory compliance, Johan said TH was audited by the auditor general, while its listed companies were regulated.
He said while some quarters often discussed TH’s capability to pay dividends or bonuses every year, not many realised that the act mandated that TH could only pay dividends when its assets exceeded liabilities.
“That position must be maintained and achieved all the time, failing which I am flouting the act itself.”
Johan said although the government of the day guaranteed the depositors’ money, this would not represent a huge liability to the taxpayers.
“We have various investments — in equity and so on — which can be revalued.
“Assuming if tomorrow the government has to repay, it can take all TH assets. So, there will be no additional burden even though the concept of guarantee exists.”
Johan said TH’s success in managing depositors’ funds and organising the Malaysian haj pilgrims every year had won praise from the Saudi government and other countries. To this day, however, no other country had established a similar set-up.
“The Philippine government recently sent a representative to come and see how we set up TH, to win over the Muslim community there.
“People are looking at us as a model, but my advice has always been, to emulate us, the buy-in and commitment by the government is very important. We are blessed because we have the act.”