Making megabucks from trips to Mecca

Making megabucks from trips to Mecca

The hajj pilgrimage is a billion-baht industry in Thailand, but the push to make it more affordable has not been universally welcomed.

Like all Muslims, Lukman Baik has been looking forward to the once-in-a-lifetime hajj pilgrimage. Despite being a mandatory religious duty provided one is physically and financially capable, Mr Lukman has been trying hard to save money for the trip. For the 35-year-old rubber farmer, doing so has been difficult, especially at a time when Thailand is struggling with falling rubber prices.

Back to normal soon: Saudi Arabian charge d'affaires Abdalelah M Alsheaiby. — PHOTO: CORY WRIGHT

"It definitely wasn't like four or five years ago," said Mr Lukman, whose wife is expecting their second child this year. "There are several Muslims where I live who don't have the financial means to undertake the hajj."

The cost of travelling to the holy Saudi Arabian city of Mecca for the hajj has been criticised by Thai Muslims as too expensive and can range from 180,000 baht to more than 200,000 baht. In Mr Lukman's southern province of Pattani, one would expect it to be in the higher price range.

In some southern provinces where the Muslim population is substantial, Anumat Amat, a member of the National Legislative Assembly, has been leading a campaign promising to make the hajj more affordable.

Part of that attempt is to change the law. The Culture Ministry's Religious Affairs Department (DRA) has responsibility for Thailand's rules and regulations regarding hajj affairs, but has come under fire over the past decade for its handling of the issue.

A draft law, backed by the Central Islamic Council of Thailand and approved in principle by the government, will relocate all issues regarding the hajj to the Interior Ministry.

Mr Anumat did not make it clear exactly how switching the governing body will lead to cost controls, but argued there would be greater efficiency in moving hajj affairs to a larger ministry with greater human resources.

"Muslims all over the country have high hopes that this bill will improve hajj management and maximise the welfare of pilgrimage from Thailand," he said.

CHECK-IN: Officials of the Ministry of Health check the vaccination documents of hajj pilgrims. PHOTO: PATTANAPONG HIRUNARD

MARKED UP PRICES

The Saudi Arabian government provides two methods of applying for the annual pilgrimage: hajj operators in each country can either register through their government or directly through the Ministry of Hajj and Umrah of Saudi Arabia. While countries like Egypt, Malaysia, Singapore and Indonesia have been allocated a certain percentage of operators to register on behalf of their clients, operators are forced to register with the DRA under Thai law.

The DRA then acts on behalf of companies in dealing with the Saudi government, ranging from the payment of fees to submitting documents for visas.

But for the average person who wishes to undertake the journey, it all starts with this one question: Who will I go with? Often, that person is a religious leader or person of authority within the community, who are known as the mutawif. These pilgrim guides also act as salespeople, gathering clients for hajj operators.

"Salespeople are the hearts and minds of hajj pilgrims," said Kamon Thongkhamwong, president of the Haj Organiser Association. "If someone dies [during the pilgrimage], they are the ones who inform the family of the deceased."

In the South, almost all recruitment is done through this method, while in Bangkok only 30% of people apply directly with a hajj operator. The profits earned by the mutawif and hajj operators can lead to a 40,000 baht mark-up on hajj packages, said Mr Kamon.

Part of the issue, however, is due to the annual quota of hajj pilgrims, which is strictly controlled by the Saudi Arabian government. Every country has a quota of 10% of the Muslim population, and in recent years the quota for Thailand has been 13,000, said Abdalelah M Alsheaiby, charge d'affaires at the Embassy of Saudi Arabia. However, the quota for the past two years has been lowered to 10,400 due to ongoing expansion work at Mecca's Grand Mosque. "The quota will be back to normal next year," said Mr Alsheaiby.

The system means that not everyone will be able to travel in the same year they apply. For Fadwa (not her real name), paying an additional fee of 7,000 baht to guarantee a place for her 2012 trip was worth it.

Fadwa's 45-day package cost 150,000 baht -- very cheap compared to market prices -- but she called her case a "special" one since she was not processed through the quota system. Those who go through the formal application process but wish to travel immediately need to pay a higher under-the-table fee, she said.

A NEW LOW

It used to be that Muslims registering for the hajj would be placed in a waiting list for two years as the number of pilgrims exceeded the quota. But for the first time, this year it fell short of the quota of 10,400 people, with 9,600 due to travel to Mecca from Aug 4.

This is made possible due to the "4 plus 1" quota system set forth by the DRA. According to the system, hajj operators get an additional place for guides for every four pilgrims registered online with the DRA. This means that if a company registers on behalf of 80 clients, they get 20 additional spots for guides, which companies usually reserve for people who are willing to pay a marked up price to travel that year.

But this presents a loophole: operators with large amounts of money can register as many names as they want in order to gain additional places, and later cancel the names, which didn't exist in the first place. This caused a problem for those who did not expect to be travelling this year. "For instance, if a person registered in 2014 and was pushed up to this year, they might not have the money to pay for the trip, especially when the economy in the South is bad due to falling rubber prices," said Mr Kamon.

Upon registering, applicants need to pay an initial insurance fee of 13,000 baht to the DRA, but are not required to pay an additional 50,000 baht (37,000 baht for plane tickets, 11,000 baht for food and 2,000 baht for service and transportation) until their names are confirmed for travelling that year.

ALLEGED CORRUPTION

In 2007, a committee was set up by the NLA to study the problems associated with the annual hajj trips. The panel, headed by Winai Sama-un, accused DRA official Anucha Haranee, now the director of the Hajj Affairs Division, of corruption regarding rental accommodation for the 2006-07 pilgrimage.

Although hajj operators were required to seek accommodation on their own, payment was made by the DRA on behalf of the operators. The practice has since been stopped. The DRA was and is responsible for signing the contract.

According to a report seen by Spectrum, Mr Anucha signed an accommodation contract on behalf of 10 business operators for 2,350 Thai guests. The companies paid a total of 6.58 million riyal (72.4 million baht at current rates) to Mr Anucha. Upon arriving at the hotel in Mecca, the guests were told that pilgrims from Yemen had already checked in, forcing the Thais to relocate to a cheaper one 2km away.

The Saudi Arabian government helped negotiate a partial return of the money to pay for the new, cheaper accommodation, but operators were not refunded for the outstanding amount.

The report accused Mr Anucha of not abiding by Saudi regulations, since the contract was not approved by the Ministry of Hajj, therefore resulting in an overlap of contracts.

"The Culture Ministry failed to take action and no one was compensated," said the report, which was later submitted to the Central Investigation Bureau's Counter Corruption Division and eventually the National Anti-Corruption Commission. "Since the committee consists of highly experienced people in hajj affairs, they would know very well the regulations set forth by the Saudi Kingdom … which shows that they have an intention to cause damage."

According to a letter submitted by the Haj Organiser Association, two weeks before the incident, operators warned DRA representatives that the housing might have already been rented by Yemeni representatives, due to the flag attached to the building.

"But we received confirmation from the officials that there is no problem," said the letter seen by Spectrum.

Mr Anucha denied that the DRA was at fault, saying that the problem was caused by signing the contract with a sub-lessee of the building as opposed to the actual owner. The sub-lessee failed to pay rent to the owner, resulting in the owner allowing the Yemen group to stay in the accommodation.

He added that the Thai hajj operators were compensated after the incident.

The issue was brought to court in Mecca, which ruled in 2008 that the Thai representatives were not guilty. "This case has caused damage towards Thailand's hajj representatives through the media … in which they [Thailand] did not commit any wrongdoing," said the court ruling seen by Spectrum.

CHANGING THE RULES

The most recent attempt to amend the 1981 Hajj Affairs Promotion Act was last year, when the Shiekul of Islam of Thailand submitted a petition to prime minister Gen Prayut Chan-o-cha to look into the issue.

Gen Prayut assigned his deputy Wissanu Krea-ngam to oversee the law's amendment, and the first proposed draft consisted of setting up a public organisation to oversee hajj affairs. The draft was rejected, and a later attempt sought to move all hajj affairs to the Provincial Administration Department (Dopa) under the Interior Ministry.

The Culture Ministry has the authority to issue ministerial regulations under the current act. While the director-general of the DRA is the de facto secretary-general of the Hajj Promotion Committee of Thailand, the Dopa director-general will assume the role instead, according to a draft bill seen by Spectrum.

The cabinet approved the change in principle in October. Mr Anumat said the bill has been approved by the Council of State and is now awaiting formal cabinet approval. If the bill gets a green light, it will then go to the NLA before being enacted as a law.

"If it wasn't for a special government like the current one, there would be no way that the bill would be passed," said Mr Anumat, who is also the deputy secretary-general of the Central Islamic Council of Thailand. "Unlike an elected government, there is no opposition this time."

The official reason behind the move is that relocating hajj affairs to the Interior Ministry will result in higher efficiency and less managerial complications due to the large amount of local administrative networks under Dopa. Another issue is human resources: while the Interior Ministry has many Muslim staff, the DRA has very few, said Mr Anumat.

"One disadvantage for Thailand is that our high-ranking officials are not Muslim and therefore are not allowed to enter Mecca," he said. "Instead, we have to send out lower ranking Muslim staff to attend hajj-related discussions."

Mr Anumat, who owns an energy management company and is a former senator for Songkhla, often travels to the South to give talks on the high prices of hajj packages, which he believes will be solved under the supervision of the Interior Ministry. While he refused to say exactly how this will result in lower prices, he said it will require making amendments to certain regulations, which will be easier in a large-scale ministry.

In Krabi province in March, Mr Anumat told a large crowd of Thai Muslims that the true cost of hajj trips would fall to 130,000-150,000 baht, but operator fees were pushing the price to 180,000-200,000 baht.

The DRA has expressed approval of the new bill, but denied that the move was a result of corruption within the department, according to a statement issued in October last year.

"The high cost [of hajj packages] does not depend on the department but is the right of pilgrims to choose the type of service from a company at whatever cost," said the statement.

Hajj Affairs Division director Anucha Haranee told Spectrum the relocation of hajj affairs to Dopa was necessary so information and services could easily be provided.

"Our work is reactive rather than proactive, due to some limitations such as not having enough networks in the village level," he said. "Dopa has a large number of village-level networks that can help facilitate in terms of providing information and services to each local administration."

THE LARGE PIE

Thailand has 108 hajj operators, all registered by law under the DRA, with a five-year renewal.

"We have far too many operators," said Mr Kamon of the Haj Organiser Association. "The hajj industry is massive, and everyone wants a piece of the pie."

The billion-baht industry involves selling hajj packages ranging from 20 to 45 days, with the average trip lasting 40 days in Medina and Mecca. Prices depend largely on accommodation, with the lower range of 170,000-190,000 baht for housing located 1.5km from the Grand Mosque. Staying at a five-star hotel could increase costs to 250,000 baht.

Mr Kamon admitted that the prices were too high, but there has not been a serious attempt by operators to sell low-cost packages.

"For the past two years we have been trying to push forward with low-cost packages ranging from 100,000-120,000 baht but they haven't been well received," he said, adding that Thais prefer a 20-minute walk to the mosque rather than travelling longer distances of 6-7km on the bus. "But next year my company is planning to sell 120,000 baht packages, which will probably sell especially well during the economic downturn."

Thailand does not provide financial assistance to hajj pilgrims, unlike some Muslim countries where the government provides low-cost packages for those who do not have the financial means to travel.

In Egypt, for instance, the government randomly selects applicants in annual lottery draws to receive low-cost packages. Thailand does have, however, a 300 million baht fund that operators can borrow from to rent housing in advance, in case they have not yet collected money from their clients.

Mr Kamon said operators had expressed scepticism that the relocation of hajj affairs to the Interior Ministry will lower the price of the packages, saying that doing so is possible regardless of the overseeing body, and that it is better for market mechanisms to do their job.

"Hajj affairs is actually more related to the Foreign Affairs Ministry, which has more to do with travelling arrangements than Dopa," he said. "It is questionable whether relocating to the Interior Ministry will serve the purpose of control, promotion or vote seeking, since Dopa is a network of politicians, and politicians can control imams."

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