Category: Budget Debate

9 2012 Allocations

9.1 Auctioning APs, enhancing collections and higher oil prices will grow revenue

Pakatan Rakyat notes that prospective economic turbulence may reduce revenues from existing sources. However, Pakatan Rakyat also recognises that the ineffectiveness of the Barisan Nasional government provides headroom for revenues to be raised without further increasing the burden on honest, tax-paying citizens. For example:

• The full value of government concessions and permits is not always extracted. These are instead offered at low valuations or prices to favoured parties who then reap super-normal and rent-seeking profits;

• High levels of illicit activity are tolerated. For example, it is estimated that nearly 4 out of 10 packets of cigarettes consumed in Malaysia are illicit⁴³ – taxes have not been paid. This illicit trade has soared by 67% in the 7 years between 2003-10. Illicit trade results in direct opportunity losses to the government from revenue foregone. In addition, it also impedes private enterprise and employment opportunities as legitimate tax-paying businesses grapple against the illicit traders. Continue reading “Pakatan Rakyat Budget 2012 (Part 10 of 10)”

8 Public Finance Strategy – the Pakatan Rakyat budgetary framework

8.1 Rationalising Expenditures, Efficiency and Value for Money
The Pakatan Rakyat government will strive to contain expenditures with the ultimate objective of ensuring the long-term sustainability of public expenditures while supporting the continued growth of the economy and the achievement of a high quality of life for all the rakyat.

Rationalising expenditures will restore fiscal space for Malaysia to face future adversities from global perturbations and ameliorate the uncertainties from the accelerating debt burden facing future generations of Malaysians.

In the short-run, while limiting expenditures, Pakatan Rakyat will put in place resolute policies to improve the efficiency of public outlays and simultaneously generate greater value for money. This will bring immediate and direct benefits to the rakyat in the form of better public services (education, health, education and social services), employment prospects, security, and infrastructure. Continue reading “Pakatan Rakyat Budget 2012 (Part 9 of 10)”

7 Thrust 3: Empowering Malaysians

7.1 Political Reforms- Democracy Now
Five decades on, democracy as practised in Malaysia today is little more than a shade of its former glory as various key public institutions have been routinely compromised by an unchecked Federal Government. Thus, Pakatan Rakyat is committed to immediately implementing the following reforms:

• To revoke all existing emergency proclamations and repeal all laws that provide for detention without trial, as outlined in the draft Emergency Revocation Act (Akta Pemansuhan Darurat) submitted by Pakatan Rakyat in the March 2011 parliamentary session.

• To restructure the Public Complaints Bureau (Biro Pengaduan Awam) into an Ombudsman institution.

• To place key public institutions including the Auditor-General’s Department, Department of Statistics, Judicial Appointments Commission, the Malaysian Anti-Corruption Commission (SPRM), the Election Commission (SPR), and the Malaysian Human Rights Commission (SUHAKAM), and an Ombudsman institution under the purview of Parliament.

• To ensure freedom of the media by removing all discretionary licensing requirements via the repeal of the Printing Presses and Publications Act 1984. In lieu of this, an independent and self-regulating media council will be put in place. Continue reading “Pakatan Rakyat Budget 2012 (Part 8 of 10)”

6 Thrust 2: Sustainability

6.1 Inclusive growth
One of the most important ways for Malaysians to contribute to our country’s progress is by being productive, working citizens.

However it is evident that the vast majority of Malaysians have not reaped the benefits of their work. Under the Barisan Nasional Federal Government, overall income levels remain low, inequality has leveled out at comparatively high levels and deep pockets of poverty continue to exist, as discussed earlier.

The current policies of centralising powers and funding with the federal government will, if continued, foster even more geographical concentration and further amplify rural-urban differences. Pakatan Rakyat will focus on developing income-earning opportunities across the economy and the nation.
Continue reading “Pakatan Rakyat Budget 2012 (Part 7 of 10)”

5 Thrust 1: Empowerment, Opportunities and Dignity for All Malaysians

5.1 All Malaysians and government must collaborate to restore dignity
The holistic economic and structural policies of Pakatan Rakyat will:

• Restore dignity to all working Malaysians and their families.Dignity through improved skills, increased productivity, higher incomes, better job conditions and better quality of life;
• Re-establish incentives for businesses and investors to upgrade and launch innovative high-value added product and services activities, and
• Enhance the motivation of government employees to facilitate this bold transformation process.

But the Pakatan Rakyat government cannot carry out these essential policies by itself and in isolation. The rakyat, as employees and employers; as housewives, caregivers and students, and most importantly as contributing citizens must play their individual and collective roles and take their place in advancing this brave agenda to move Malaysia forward to greater heights to stand tall globally.
Continue reading “Pakatan Rakyat Budget 2012 (Part 6 of 10)”

4 Policy Highlights

4.1 Spending RM220 billion more effectively, while reducing the deficit

The global uncertainties and prospect of lack-lustre private demand would ordinarily call for pump-priming and stimulus measures by the government.

However, Malaysia’s finances, after 13 consecutive years of budget deficits by the Barisan Nasional government, no longer permits massive stimulus packages. On the contrary, the recent experiences of crises in countries with massive deficits eg the United States, United Kingdom and Greece, calls greater attention to reducing budget deficits.

Against this backdrop, Pakatan Rakyat will strive to maintain the total level of federal government spending at RM220 billion¹⁰ in 2012. Pakatan Rakyat practices of competency, accountability and transparency will result in:
Continue reading “Pakatan Rakyat Budget 2012 (Part 5 of 10)”

3 Malaysia Today

Malaysia, too, has less fiscal options than before in weathering the impending turbulence:

• In 2007, before the 2008/09 crisis, our federal budget deficit was RM21 billion and total federal debt was RM267 billion, equivalent to 42% of GDP;

• For 2011, our federal budget deficit is expected to hit RM45 billion and total federal debt was already RM437 billion as at the end of June, equivalent to about 53% of GDP⁸;

• Indeed, ratings agency Fitch downgraded our long term RM sovereign debt rating to A from A+ in Feb 2009. Malaysiahas not been able to secure a return to A+ even though the global economic situation subsequently stabilised and improved. The Barisan Nasional government continued to expand spending after prime minister Najib assumed leadership in Mar 2009, even though stimulus measures were no longer necessary.

The scope for pump-priming and stimulus measures in the face of another slowdown is now limited. But we still have strengths and alternatives: Continue reading “Pakatan Rakyat Budget 2012 (Part 4 of 10)”

2 The Global Backdrop
The world economy is entering another period of turbulence and uncertainty following two years of tentative recovery. It now seems clear that the US-led response of easing monetary policy following the 2008/09 financial crisis bought only temporary respite.

The extensive monetary easing masked the structural imbalances in the world economy and allowed “business as usual” to continue. Asian economies continued to depend heavily on exports, particularly to the developed, western economies.

In the meantime, the US and EU governments recorded huge increases in sovereign debt as they eased monetary policy:

• US government debt has more than doubled since 2008, ballooning from US$7.0 trillion in 2008 to bump up against its original ceiling of US$14.3 trillion in Aug 2011. The ceiling was raised only at the last minute after a bruising political battle between Democrat President Obama and the Republican-dominated Congress; and

• In the European Union, sovereign debt worries are expanding. Starting with Ireland and Greece, concerns extended to Spain and, most recently, Italy. Total sovereign debt of the 27 Euro nations soared 26% in two years to €9.8 trillion in 2010 from €7.8 trillion in 2008.

Continue reading “Pakatan Rakyat Budget 2012 (Part 3 of 10)”

CONTENTS

• 1 The Key Thrusts of Belanjawan Kesejahteraan 2012
  • 1.1 Opportunities and Dignity for All Malaysians
  • 1.2 Sustainability
  • 1.3 Empowering Malaysians
• 2 The Global Backdrop
• 3 Malaysia Today
• 4 Policy Highlights
  • 4.1 Spending RM220 billion more effectively, while reducing the deficit
  • 4.2 Prosperity through higher skills, incomes and opportunities
  • 4.3 Subsidy policy to be overhauled: The poor to be uplifted
  • 4.4 Immediate Measures to Help Malaysians
    • 4.4.1 Senior Malaysian Bonus for the elderly
    • 4.4.2 Support for home-makers
    • 4.4.3 Eradicating hardcore poverty

Continue reading “Pakatan Rakyat Budget 2012 (Part 2 of 10)”

Snapshots

1. Kesejahteraan Untuk Semua
Belanjawan Kesejahteraan 2012 is a continuation of the collective effort by Pakatan Rakyat to chart a new future for Malaysia, following the releases of the Common Policy Platform in December 2009 and the Buku Jingga in December 2010.

Kesejahteraan Untuk Semua can be only achieved with political will to effect genuine and comprehensive institutional reforms guided by the principles of transparency and good governance.

Malaysia’s diversity is our strength. Our economic growth depends on the solidarity of all people regardless of gender, ethnicity or religion. Only through a budget which is gender responsive, and one that empowers ordinary Malaysians to live a dignified life full of opportunities , will we unleash the full potential of our people.

Recognizing the inflationary pressures on the Malaysian public, Belanjawan Kesejahteraan 2012 creates growth for all through providing policies and frameworks aimed towards uplifting the 60 percent of Malaysian households earning less than RM3,000 monthly.

Introduction of minimum wage, reduction of unskilled foreign workers, upgrading of skills and productivity will massively benefit the Malaysian workforce. In particular, special attention is given to improve women’s participation in the workforce. Wage, skills and productivity will improve in tandem.

Improvements to public transport, housing and healthcare will contribute to increasing disposable income of the people. Higher disposable income will enhance domestic consumption, which is increasingly more important in the volatile global environment.

Monopolies and oligopolies will be broken up, enhancing competition while helping Malaysian businesses to reduce costs. A competitive environment will mitigate inflationary pressures and generate more choices for the people. Continue reading “Pakatan Rakyat Budget 2012 (Part 1 of 10)”

By Boo Su-Lyn
The Malaysian Insider
October 25, 2010

KUALA LUMPUR, Oct 25 — Putrajaya’s focus on mega construction projects instead of key reforms in its economic plans — symbolised by the 100-storey Warisan Merdeka tower — will hamper the country’s goal of becoming a high-income nation, analysts have said.

They have stressed that economic and institutional reforms to increase market efficiency and human capital development were the crucial elements to lift Malaysia out of its middle-income trap.

“It is not sustainable as we will have first-class infrastructure and facility and third-world work ethics and mentality,” RAM Holdings group chief economist Dr Yeah Kim Leng told The Malaysian Insider.

“The soft part of the development, which is the human capital, will have to take centre stage for the high-income transformation drive to be successful,” he added.

Yeah noted that Prime Minister Datuk Seri Najib Razak’s reform commitments in his New Economic Model (NEM) have been eclipsed by the mega construction projects announced in Budget 2011 and the Economic Transformation Programme (ETP). Continue reading “Building projects unsustainable in long run, say analysts”

Despite all its bombast and pyrotechnics, Prime Minister Datuk Seri Najib Razak’s 2011 budget is not a child of the New Economic Model but bears all the marks of old discredited policies which have landed Malaysia in the middle-income trap for more than a decade, setting the country towards a failed and bankrupt nation come 2019.

Former Prime Minister Tun Mahathir’s obsession with mega projects like the proposed RM5 billion 100-storey Warisan Merdeka tower is back with a vengeance.

If Najib is seriously committed to a New Economic Model, based on economic, social and government transformation, wouldn’t it be more appropriate for Malaysia to achieve targets as being ranked among the first twenty if not first ten of the least corrupt nations in the annual Transparency International Corruption Perception Index or having at least 10 universities which are ranked among the Top 100 Universities in the world?

In fact, it must be asked whether Najib is secretly trying to out-Mahathir Mahathir not only to build a tower higher than Mahathir’s Petronas Twin Towers, but which could be acclaimed as the tallest in the world – however brief the claim? Continue reading “Najib’s 2011 Budget is not a child of New Economic Model but bears all the marks of old discredited policies”

The Finance Minister said in the budget speech that the Government will expedite the implementation of HSBB at a total cost of RM11.3 billion, of which RM2.4 billion is from the Government and RM8.9 billion from Telekom Malaysia, and that a speed of 10Mbps will be provided in selected areas in Kuala Lumpur and Selangor by end-March 2010 while these services will be extended to other selected areas nationwide between 2010 and 2012.
He also said that Malaysia’s broadband penetration is currently at 25%, a rate that is far lower compared to Korea, Singapore, Japan and United States.

There is a contradiction here.

In simple terms, administration is spending RM2.4 billion to encourage Telekom Malaysia to spend RM8.9 billion for selected areas in KL and Selangor to be further extended to other selected areas nationwide.

The government policy in subsidizing HSBB is creating broadband desert in the rural area as its fiscal policy continues to favour the urban and high-income rakyat as shown by its tax cut for the top-earners.
Continue reading “Broadband Penetration vs Broadband Quality vs HSBB”

1. RM12.5 billion Port Klang Free Zone (PKFZ) scandal.

   The Cabinet decision last month to set up a super task force, headed by Chief Secretary to the Government Tan Sri Mohd Sidek Hassan, to take over all investigations into the PKFZ scandal is not a demonstration of political will to get to the bottom of the “mother of all scandals” but the opposite.

   I see it as a major step backwards in public accountability and good governance, as it smacks of being a super “cover up” task force for the PKFZ scandal.

   What is needed is a Royal Commission of Inquiry to conduct a comprehensive and no-holds-barred investigation into the “mother of all scandals” including relevant Ministerial and Cabinet aspects of the scandal instead of trying to sweep the whole issue back under the carpet.
   In the first place, is Mohd Sidek the most appropriate person to head the super task force on the PKFZ scandal?

   Continue reading “Super cover-up of RM12.5 billion PKFZ scandal?”

What is the credibility of Najib talking about a total innovation of the Malaysian economy and nation when Malaysia is facing a losing battle in international competitiveness because of continuing loss of confidence in key national institutions whether judiciary, the civil service, the police, the MACC or the Election Commission?

This is the reason for the two recent adverse global rankings for Malaysia, falling three places from 21st to 24th ranking in the World Economic Forum (WEF)’s Global Competitiveness Report (GCR) 2009-2010 and a drop of two places in the World Bank’s Doing Business 2010: Reforming Through Difficult Times from 21st to 23rd placing.

The first seven months’ of Najib’s premiership have not seen any restoration of public confidence in the key national institutions but the reverse whether in the strategic areas to fight corruption and ensure integrity; keep crime low to protect the safety of citizens, tourists and investors; or to uphold the administration of justice.
Continue reading “Malaysia’s losing battle for international competitiveness”

To many Malaysians, the deplorable cowhead protests incited by UMNO in Shah Alam section 23 three days before National Day over the relocation of a Hindu temple was strong evidence of the lack of seriousness and commitment of the Najib administration to the “1Malaysia concept” – which put Malaysia in the dock of world opinion with adverse international media reports scaring off intending investors with the spectre that Malaysia is on the verge of greater racial and religious polarisation and intolerance.

The announcement in the budget of the award of national scholarships to 30 crème de la crème students strictly on merit for educational studies in world renowned universities is not proof of 1Malaysia – but the very reverse, of the discriminatory and divisive nature of Barisan Nasional government policies in the name of NEP when they should be based on meritocracy coupled with socio-economic need and justice.

National scholarships to 30 crème de la crème students for world renowed universities is a paltry and most ridiculous figure 52 years after Merdeka.
Continue reading “A Malaysian Civil Service totally against 1Malaysia concept”

Or does Najib think that Umno/BN victory in the Bagan Pinang by-election could be used as proof of popular support for his 1Malaysia slogan?

Then, what about Umno/BN defeats in the Bukit Gantang, Bukit Selambau and Permatang Pasir by-elections, if we do not to mention Penanti by-election, where 1Malaysia theme could not ensure victory? Is this to be taken as three by-election defeats as against one victory for Najib’s 1 Malaysia since he became Prime Minister in April?

It is not wise to turn 1Malaysia into a political party issue.

I had publicly called on Najib to officially withdraw the 1Malaysia slogan from the BN Bagan Pinang by-election campaign.

Firstly, what 1Malaysia could the BN talk about when there is even no 1Umno, 1MCA, 1MIC or 1BN?
Continue reading “Does 2010 Budget pass as a 1Malaysia Budget?”

Najib will be finishing his seventh month as Prime Minister which he started off with the slogan “1Malaysia. People First. Performance Now”.

Does Najib’s 2010 Budget pass as a 1Malaysia Budget?

Two events have cast their shadows over the 2010 Budget and the 1Malaysia slogan – first, the drowning of 11 year-old Dina Devi Nathan from SJK (T) Mambang Di Awan and we have just received reports confirming the death of the other two eleven-year-olds Devadharshini Mageswaran from SJK (T) Mambang Di Awan and Divya Shree Vasudevan from SJK (T) Gopeng when the suspension bridge of the Education Ministry’s 1Malaysia motivation camp at SK Kuala Dipang collapsed on Monday night, sending some 30 pupils crossing the bridge into the Kampar River.

Like other DAP MPs including the MP for Bagan, Lim Guan Eng, MP for Beruas Ngeh Koo Ham, MP for Ipoh Barat, Kulasegaran who visited the tragic Kuala Dipang site on Tuesday, I was shocked and outraged at the utter recklessness, negligence, irresponsibility and complete disregard for the lives and safety of schoolchildren on the part of the authorities, particularly the education department and the contractor concerned, in allowing the suspension bridge to be built without adequate foundation or safety features causing its collapse in two weeks and claiming the lives of three children.
Continue reading “1Malaysia kills – “1Malaysia 2Perak 3Katak””

In his first budget, the 2010 budget, presented to Parliament last Friday, the Prime Minister and Finance Minister, Datuk Seri Najib Razak claimed that he is laying the foundation for the development of a new economic model to become a high-income economy.

He stressed that the new economic model must be based on innovation, creativity and high-value added activities so that Malaysian can remain relevant in a competitive global economy.

Najib announced that his government “will transform Malaysia through a comprehensive innovation process, comprising innovation in public and private sector governance, societal innovation, urban innovation, rural innovation, corporate innovation, industrial innovation, education innovation, healthcare innovation, transport innovation, social safety net innovation and branding innovation.”
Continue reading “End NEP which has trapped Malaysia in middle-income group instead of becoming a high-income economy”