Pakatan Rakyat’s policy statement on New Economic Model (Part 3a)

PART III: SHORTCOMINGS AND CONTRADICTIONS
Originality Is Suspect

The three main thrusts of sustainability, inclusiveness and high income bear striking resemblance to basic tenets enumerated in Pakatan Rakyat’s Malaysian Economic Agenda (MEA).

In fact, the concept of needs-based “affirmative action” (rather than the race-based approach as espoused in the New Ecomomic Policy) that is being touted as a major breakthrough for Barisan Nasional is clearly borrowed from MEA which first proposed the idea in 2006.

The extent of copycat does not stop there. NEM talks extensively about the need to abolish rent seeking culture in order to reinvigorate the economy.

In a speech to a dinner function hosted by Harvard Club of Malaysia on 5 May 2005, former Prime Minister Dato’ Seri Abdullah Ahmad Badawi lamented the widespread culture of rent seeking in practice.

He urged the public to “be willing to develop ourselves and let go of the addictions we have become accustomed to. It is a question of willingness more than a question of ability. It is a question of mentality.”

Unsurprisingly, despite a public declaration of war against rent seeking culture, scandal after scandal tarred the image of Barisan Nasional. In public the BN talks about doing the right thing, in private it continues to condone rent seeking so much so that the issue of “money politics” (the euphemism for rent seeking) becomes a permanent agenda item at Umno’s General Assembly. In the years since the former Prime Minister’s declaration the situation seems to have gone from bad to worse.

Pakatan Rakyat is not at all surprised to see that the same battle-cry of “war against rent seeking” that was once featured prominently in the previous administration; is now recycled and repackaged into NEM.

Pakatan Rakyat is not against the idea of reform – be it in the form of reduced subsidies, more equitable social welfare programs and a fight against corruption.

The fact that these themes and targets are brought forward from one economic plan to another is a proof that the government is not serious in carrying out the necessary reforms.

When three consecutive Prime Ministers from the same party talk about achieving the target that his predecessors failed to deliver, it demonstrates a complete and systemic failure on the part of the government to deliver its promises.

In that perspective, one cannot blame the public if NEM was received with lukewarm response because time and again, Barisan Nasional has the habit of employing public relations tactics to delude the people with grandiose development and growth targets; only to quietly shift the unrealised targets and objectives into the next major economic plan.

Investors’ immediate reaction to NEM was muted. Bursa Malaysia’s Composite Index hardly moved. The market’s response was a big disappointment considering how heavily the NEM had been marketed as the saviour of Malaysia’s economy. :

	30 March 2010 (the day NEM was launched)	31 March 2010 (immediate response)
Composite Index	1,319.35	1,320.57
% change	–	0.09%
Volume traded	65,188,200	113,073,296

This sentiment is echoed by a majority of market analysts. Instead of overwhelming endorsement, the market was greeted with reviews with headings such as “New Economic Model: No Big Surprises, Awaiting Further Details” that corroborate with Pakatan Rakyat’s own sceptical view of the NEM.

Barisan Nasional must take heed that the public is impatient with the failure to deliver results and the constant repackaging of these failures into new economic planning.

This habit of delayed progress is precisely the reason we are in an untenable economic position today. In spite of the public pronouncements claiming that that NEM is a major departure from the past; in fact the NEM is nothing more than a set of repackaged failures of the earlier policies.

Lack of Political Will
The root cause of the failures to achieve the goals of consecutive economic plans lies in the utter lack of political will and seriousness on the part of Barisan Nasional leadership.

Each year, the Auditor General’s Report highlights various examples of mismanagement and misappropriation of public funds at all levels of the government.

While Pakatan Rakyat does not condone corruption or criminal breach of trust in any form or amount, one should understand the psyche of Barisan Nasional-led administration in which the topmost leadership indulges with the worst kind of alleged mismanagement.

When a minister or ADUN or Ahli Parlimen is implicated in scandals to the tune of billions of ringgit (for example the PKFZ scandal which implicates a good many politicians from Barisan Nasional), no punative action is taken, and every effort is made to cover up the scandal. It is not surprising that a lackadaisical attitude towards corruption permeates all the way downwards in the organisation.

Year after year, Auditor’s General Report highlights various mismanagement and recommendations from the lowest to the highest level of government. Among some of the highlights are as follows:

2008

AG Report Year	Media Report	News Heading	Amount (RM)
2008	Utusan Malaysia	“Kerajaan Rugi Hampir 1 Billion” – 19 October 2009	1 billion
The Star	“Extra RM10 million and Three Years To Finish Hospital” – 20 October 2009	10 million
2008	NST	“Paying RM28,500 More Than What It’s Worth” – 21 October 2009	28,500
2006	Daily Express	“Defence Ministry Bought RM6.75 Billion of Defective, Non-delivered Petrol Boats” – 14 September 2007	6.75 billion
2006	The Star	“Chief Secretary to the Government Promises Action Against Those Implicated in AG’s Report” – 12 October 2007 on National Youth Skills Institute (under the Youth and Sports Ministry) project where a car jack that cost RM50 was bought for RM5,700, a digital camera that cost RM2,990 was bought for RM8,254 and RM1,146 was paid for a set of technical pens with a market price of RM160.	8.39 million
2006	The Star	“Chief Secretary to the Government Promises Action Against Those Implicated in AG’s Report” – 12 October 2007 on the purchase of two helicopters worth RM117.75 million by the police air wing, which could not be used, as they did not meet specifications. Another RM15.4mil was spent to train pilots to fly these helicopters.	133.15 million

The findings are not a discovery for the majority of Malaysians as this culture has been accepted as being very prevalent. What surprised the nation was the extent of the losses suffered by the country due to such mismanagement and misappropriation – The Star estimated that the country lost up to RM28 billion due to the practice of direct negotiations; estimated from Auditor General’s Report 2008.

These are proofs of the sheer lack of political will on the part of Barisan Nasional leadership as each year the Auditor General’s Report continues to highlight misappropriation of epic proportion. Yet the good work of the National Audit Department as if had fallen on deaf ears and had become an annual ritual for Barisan Nasional to rubbish its findings year after year.

It is from this perspective that Pakatan Rakyat believes that NEM will not progress beyond the initial media galore. The kind of economic reforms required to ensure the success of NEM will be all encompassing and touch the backbone of the rent seeking culture prevalent especially in Barisan Nasional – so much so that Prime Minister himself admitted publicly that “his head is on a chopping block” as he proposes these reforms.

However, YAB Dato’ Seri Najib Tun Razak must come clean with the nation on his detailed plan to demonstrate his political will in pushing for reforms. The act of demonstrating moderation and openness to reforms only when he is abroad and facing foreign journalists whilst allowing quarters related to Umno to contradict every reform that his government has pledged to do; will not win him much confidence from the public and international observers.

On that basis, NEM started on a wrong footing. Prior to its unveiling, Barisan Nasional’s political goodwill to push for reforms came under serious doubt when it entertained pressures from known right wing groups such as Perkasa.

Now that Minister in the Prime Minister’s Department himself openly declared that the NEM document is a mere suggestion to the government, the public should not put too much hope that the major reforms will see the light of the day as the jostling for the status quo to remain is taking place behind the closed doors even as the country digests NEM page by page.

In the end, NEM will meet with the similar fate of its predecessors. Malaysia is never short of economic plans and grand planning – what was lacking was the political will to implement it.

Without such political will, even plans of lesser ambitions such as the 8MP had been a failure – let alone such an ambitious design to remake our economic landscape.

Pakatan Rakyat’s verdict is simple – Barisan Nasional’s leadership must convince the public of its seriousness and political will first before NEM can be accepted as the right direction for the country to take economically.