The economic contribution from natural resources, especially in oil and gas is expected to decline over the next 20 years as our reserves runs dry. As revenue from oil and gas constitutes more than 40% of the overall Government budget, there is a serious challenge in sourcing alternative sources of revenue to sustain Government expenditure at current levels.
The direct source of replacement contribution towards greater economic productivity in the light of the above will be by substantially raising human capital. With the right quality of human capital, many countries around the world which are not as blessed with natural resources have recorded significant growth above and beyond what we have achieved.
In light of the above, the DAP proposes legislating that at least 50% of our windfall revenues from the oil and gas sector shall be allocated to building human capacity, particularly in Education and Training, above and beyond their normal allocation. This will ensure that our windfall revenues will be productively invested in our most important assets, in particular, the young Malaysians.
We will give every child access to a first-rate education. In every school, the focus will now be on quality. More teachers will be deployed to ensure that there will be more time to plan for quality and innovation in teaching. Our schools must encourage creation of new ideas and creative thinking via different types of classrooms, different styles and different methods, but all with a strong emphasis in quality.
Building World Class Tertiary Institutions
The focus of higher education must be on the quality of the existing tertiary institutions instead of creating new universities for Malaysia. At this point of time, Malaysia has more than double the ratio of university to population compared to countries with better quality education system such as Singapore. As a result, further expansion of tertiary students intake at public universities, expected to reach 294,000 by 2010 will be absorbed into existing universities. To cope with this expansion, an allocation of RM1.2 billion will be provided to upgrade and improve facilities in existing universities.
Universiti Sains Malaysia, Universiti Malaya, Universiti Putra Malaysia and Universiti Kebangsaan Malaysia have been granted “research university” status. These leading Malaysian universities should be allocated RM200 million each to conduct research activities. In addition, to promote the universities’ self-sufficiency and fund-raising capabilities, every additional ringgit up to RM200 million which the universities, including all other local public universities are able to raise from the corporate sector or their alumni for research purposes, the Government will back the fund with an additional ringgit.
On top of the above, the DAP proposes that university academics and lecturers will have their pay de-linked from the civil service pay scale and structure. For a start, university academics shall enjoy an immediate 20% increase in pay. In addition, allowance for academics critical faculties which competes with the private sector will be raised by 300% from the current levels between RM200 to RM300.
A further study will be conducted to revise the remuneration packages for them to ensure that our universities are able to attract the best academics from around the world to teach and research at our universities. Without these global talents, whether Malaysians or foreigners to lead our academia, it will be difficult for our universities to excel in the increasingly globalised and competitive world.
To promote quality and competitiveness between the local public universities, for the 2008 university intake, each university should be able to evaluate their selection of students on the basis of the students’ own preferences. Only if the students are unable to secure a place based on their preferences, will they be allocated a place by a central clearing agency at the Ministry of Higher Education. This change in university placement will result in greater university autonomy in forming the character as well as managing the quality of their own institutions. In the longer run, it will result in much higher quality institutions of higher learning.
To promote access to university education, in particular, those from poorer financial circumstances, student loans should be made available to any and all student who qualifies for tertiary education. However, to ensure efficiency and transparency, as well as to minimise the risk of default, the education loan fund should be managed and administered by all the local commercial banks in Malaysia at preferred interest rates subsidized by the Government. This move will ensure that all deserving students shall have speedy access to funds, preventing unnecessary anxiety caused by delays. At the same time, it will reduce the administrative cost borne by the Government as well as the high percentage of defaults faced currently due to poor and weak enforcement by Government agencies.
Investing in Research and Development
In order to build up a world class economy, the nation needs to invest in the research and development of core technology and products. This will reduce our reliance on foreign expertise as well as increase the competitiveness of our country. Our expenditure on Research & Development has historically been low, but we should boost R & D spending to 2% by 2012, and 3% by 2015 of the country’s GDP annually. For the 2008 Budget, we should have allocated RM3.2 billion which represents approximately 0.5% of Malaysia GDP in contrast to the RM1,370 million allocated by the government for various biotechnology and ICT funds and projects.
The reason for the gradual increase in R&D funding is for the simple reason that it will take time to attract and grow the necessary talents to and in Malaysia to lead Malaysia’s infant R&D industries. The nation’s R&D thrust goes hand-in-hand with our policy in building human capital, for without the necessary levels of skills and intelligence, no amount of money will deliver the necessary results from our R&D ventures.
Malaysia’s primary focus to date has been to construct buildings and infrastructure but we have often failed miserably in the areas of attracting the right quality of expertise and knowledge. Hence, for our R&D thrust to be successful, Malaysia must also invest not only in producing our own R&D scientists but also attract global R&D experts to pursue their research career in Malaysia. Many of these will be Malaysian researchers currently pursuing their careers overseas. It is only with a sufficient critical mass of top global researchers transplanted to the country, that the R&D movement within Malaysia will blossom. However, this means paying the right amount of money for the right quality of talent to set up their operations in the country.
Over the next decade, we should strive to reach this critical mass of top-rate researchers in Malaysia, who will create new intellectual property in our research institutes, universities and hospitals, and will bring in new, technology-driven activities which will spin off benefits to the rest of the economy. This way, Malaysia’s economy can truly move up the value-chain ahead of the fierce competition from our neighbours such as Vietnam, Thailand and even China.
As the areas of research in engineering, biotechnology, ICT as well as other fields is vast and endless, it is also critical that Malaysia’s investment is allocated to a smaller area where the likelihood of success is higher, based on our own competitive advantages. Any lack of focus in the areas of research will result in too little money spent on too many projects leading to negligible results. In addition, it is important that we recognise that we will never be able to spend a similar quantum of funds in R&D as compared to highly developed nations.
However, the sheer complexity as well as depth of knowledge and experience required to decide on sensible and viable policies render our local governmental agencies highly ill-suited to the task. Hence, the DAP proposes the set up of a Research & Development International Action Team (RADIANT), an executive council of internationally renown academics from the scientific community to steer the R&D direction, innovation and entrepreneurship focus for Malaysia.
(Speech 8 on 2008 Budget in Parliament on Monday, September 10, 2007)
Liao should said it to TV3 and not to the chinese paper only.
I just want to know what crazy math the PM and Finance Ministry cooked up to get a lower budget deficit in 2008 and 2009? The numbers don’t jive. The only way it can be done is assume they take EVEN MORE from Petronas.
So this idea of taking the candu off the Petronas money pump is a pipe dream…
Yes, human capital is important in this globalisation and knowledge economy age. We do not need to look too far , just look at our neighbour Singapore.
Singapore is short of natural resources (oil, gas, palm oil, rubber etc) and yet able to achieve first world status. Why? Think about it. Look at what they have done since 1965 and under the leadership of LKY. Find out how many great scientiests reside in this small country. Get a list of world famous universities that had set up branch campus in this country. How much efforts they have placed in biotechnology & pharmaceutical research and development. How much efforts this government has encourged their people to learn standard English (not Singlish) and even master Chinese? Look at their cabinet ministers’ academic qualifications and compare to Malaysia counterpart, you will wonder how could such a small country produces so much of talented people. We have a lots to learn from Singapore. Never shy about it.
If only the government can stop dishing out free money to all kinds of contractors from supplier of power (IPPs) to supplier of screw drivers, the budget can be slashed in half. If only.
Optimising human capital that had ‘passed away to the great beyond’
Still want to give your vote to this type of cheating government?
http://malaysia-today.net/blog2006/newsncom.php?itemid=8081
The Raub welfare department disbursed RM101,765 to 33 people who had died while its Bentong counterpart parted with RM11,279 to three who had passed on.
The auditor-general said this was totally unacceptable. He said corruption was involved as the money could not be disbursed to the dead….”The recipients are dead but still received aid as their names were not removed from the department’s list”
that is excellence proposal from DAP, if BN willing to refer to this proposal i think m’sia education in future will be bright. but, i dont think BN will do this…
This 8th parliamentary speech on budget sounds like a part of DAP’s manifesto for the coming election.
To be sure, the government does not in principle disagree with the DAP/Opposition that Malaysia should develop its human capital to harness best its bountiful natural resources.
Everyone agrees on the methods of how to do it : new methodologies, blue prints and programmes for education ; more funding for education, R&D, more emphasis on science, engineering, biotechnology, ICT – improvement of infrastructure by more universities, technology parks and all kinds of “jayas†from Cyberjaya to InventQJaya etc
Everyone also agrees on the objectives of human capital development : to move the country up the economic/technological value chain in providing both products and services at global level, failing which we languish in economic doldrums before fading to irrelevance and oblivion.
Now who would dispute these sensible objectives and grudge such aspirations?
But lets be realistic. Such laudable objectives are conceived by men, have to be implemented by men and equally have been and will be thwarted and frustrated by men – especially in the latter case, the politicians.
I may be naïve but to me we are skirting the peripherals and not addressing the fundamental obstacle to everything – our political baggage, race factor and the NEP!
For Malaysia to move up the value chain Malaysians at the personal individual level and at the group level (together as a team, a company, an organization, a society and a nation) must unite together based on common acceptable benchmarks conductive to creation of value – ie competitiveness, an ethos of work as title deed of integrity, the standard of excellence measured on basis of meritocracy, and of course whilst we unite under the national language cultivate a high standard of English, the international language….
Politicians can still leverage on race and religion because at the constituency level the mindset emphasizing on race and religion that keep Malaysians separate have not changed and if anything have become more polarized by the politicians’ rhetoric.
Instead of dismantling the NEP that is an antithesis to meritocracy, competitiveness and ethos of hard work and excellence that are prerequisites of human development, the 9th Malaysia Plan sees the NEP extended in tenure and scope of application!
What competitive spirit on basis of merits are we talking about when apart from the Iskandar region the rest of Malaysia has all kinds of FIC rules, quotas and licensing rules marginalising foreigners from competing?
Even amongst locals, wher is the competition when politically favoured rent seekers are given monopoly to make money without value add, and you know what I’m talking about!
There is no open tender for government contracts : those negotiated culminate, as in PKFZ case, in a RM4.6 billion bailout!
YB Kit himself has said under the thread of Economic Prospects – dangerous Times Ahead : “One section in the budget – tucked under the Corporate Social Responsibility section – is likely to further alarm the private sector. The budget proposes from next year, that all public-listed companies will have to disclose their employment composition by race and gender, and list program to develop local and Malay partners. This surprising section is only one sentence long, but it will reinforce the idea of a stronger Malay, rather than a national agendaâ€Â.
Apa ini? ‘Cakap’ of human development is senang but ‘bikin’ is susah!
The greatest obstacle is not that we do not know what is right for us in terms of objectives and aspirations. Neither has it anything to do with deficient infrastructure or financial resources.
The obstacle is feudal parochial mindset and culture preoccupied with considerations of separateness of race, colour, creed and religion all the time as if we were all in a sum zero game, a mindset that stubbornly refuses to change and staunchly underpinning a political system based on patronage and wallowing in systemic corruption and failure.
And even as we speak of how best to turn Malaysia from its present role of a ‘nett importer’ of ICT to that of a ‘nett producer’, we are experiencing at ground level a net import of brawn and semi skilled from surrounding countries and a net export of our brains due to the prevailing policies!
Why are we wasting time talking of lofty aspirations when the intangible prerequisites of a fair and equitable society in which all may be united for a common aim of driving Malaysia up the value chain by embracing shared norms of meritocracy, competitiveness and work ethos and excellence are just not there?
Get priority right and talk of baby steps first before the ultimate destination of a journey of 6000 miles, as Mao Tze Tung would say!
With these bunch of corrupted morons in power and the stupidity in majority voting block as highlighted by TDM, there is really no hope. Malaysia is heading for the abyss. Period.
the only method malaysia system can be change is the witness of the whole total destruction of it’s system itself. otherwise the ego is too strong to let go.
Jeffrey’s article sums it up pretty comprehensively- it’s going to be a gigantum task to undo the harmful effects from the “dinosaur” era…not impossible, but it indeed will take decades to change the feudal parochial mindset,culture of preoccupation of separateness of race, colour, creed, and religion, that has made the nation a dependent instead of an independent one. With further prospects of common law being replaced by Shyriah, a continued emphasis on the Islamic State, it is hard to see the country keeping up with demands of globalization. However, miracles are not impossible and so there is always hope!
What human capital!!!! To the BN the more brain drain the better they are because they can do what they like and not many people will challenge them. 20 years is not long, to the Chinese please wake up, you need to vote for more opposition MP so that there is check and balance.You will be regret if you continue to vote BN. A VOTE FOR OPPOSITION IS A VOTE OF HOPES FOR YOUR CHILDREN!!!!!!!!!!
When minimum wages of RM900 also cannot meet, want to talk about human capital? Why not talk about how to turn everyone into slaves?
If the majority group is taken care of from the womb to the tomb, what are we talking about this lofty aspiration of putting this nation on par with other great nations of the world. All I’ve to say is don’t talk cock. It just wouldn’t happen.
I can only think of 2 ways and 2 ways only that this could be possible. (1) The arrival of some white knights in the ruling party in
near future with the political will to dismantle the present system.
(2) The voters wake up to the fact that this government is so rotten that it has to be voted out to give the opposition the reign of power.
human capital? export all the illegals back to their homeland, export, not repatriate, as export brings revenue and repartriate means tax payer has to pay, again.
How to optimize human capital when they put ten men on a job which only requires two? The other eight just stands around chatting and doing nothing. And they only mess up things which require more human resource to rectify.
I used to see dozens of men from TM surround a telecom exchange box next to my house “repairing” the lines and just days after their disappearance, another group of guys comes around to open up the exchange box. In fact, with too frequent openings of these boxes, the locks are spoilted and most of these exchange boxes cannot be locked.
And most of the time, on the pretence of testing the repaired lines, these people will make phone calls and have long conversations with “god knows who”.