Cut salaries of incompetent Cabinet

Cut salaries of incompetent Cabinet

Lead by example. 1Malaysia Development Berhad (1MDB) Prime Minister Najib Razak and his bloated Cabinet should voluntarily take a pay cut given the depressing economic times.

This will ensure that Cabinet members also feel the financial and economic stress of the rakyat (people) who are struggling to put food on the table daily to feed their loved ones.

On-line news portal malaysiakini has this report from a recent forum:

"NAJIB’S UNDERPERFORMING YES-MEN: SLASH THE SALARIES OF OVER-LARGE CABINET TO COMPENSATE FOR THE PEOPLE’S SUFFERING – ECONOMIST

Politics | October 17, 2016 by | 0 Comments


The salaries of ministers ought to be slashed given the current economic climate, said economist Muhammed Abdul Khalid.

He said the Malaysian economy is not yet in crisis, but is not in good shape either, and the government is already taking austerity measures by slashing expenditure.

“The only thing we have not seen since the last economic crisis is to cut the salaries of the ministers, which I think we should.

“It is symbolic, right? You feel the pain, we share the pain,” he told the audience during a forum organised by the DAP-linked think tank Research for Social Advancement (Refsa) in Kuala Lumpur today.

He said this when the panel was asked whether the Malaysian economy was in crisis, and whether austerity measures ought to be taken.

Earlier, another panellist and former Bank Negara assistant governor Latifah Merican Cheong told the forum that civil servant salaries, including those of the ministers, were slashed twice during the 1998 Asian economic crisis. This was to cut the government’s overall operating expenditure.

She said the central bank at the time had also identified large projects with high import content to be the cause of Malaysia’s trade deficit, so the government shelved its projects that had more than 40 import content in its components.

“So at that time, there was a lot of responsibility in terms of economic management. The diagnosis was right, the fundamental problem was recognised, and corrective action was taken appropriately […]

“These measures actually resulted in a solution. We reverted to surplus both on the trade account as well as on the fiscal side. So now, what do we have today?

“I would like to think that a lot of good practices are still in place, but somehow the fiscal discipline has been marred by decisions that are more skewed towards political convenience rather than being based strictly on economic considerations,” said Latifah, who is now the deputy president of the Malaysian Economic Association.

She said she would like the government to restore some of its fiscal discipline, and curtail its discretionary spending.

Meanwhile, Muhammed said the budget should not be cut in places where it is productive, such as scholarships, education, healthcare, and social services.

He said such spending would help drive growth in the future by developing Malaysian’s human capital.

Instead, the areas where spending can be slashed or deferred, he said, are those that would involve foreign currency, such as defence.

Unemployment insurance


Muhammed also urged the government to set up an unemployment insurance scheme, as most Malaysians have little to no savings and would not be able to survive more than a few months if they find themselves out of work.

This is in view of the fact that there is little the government can do to increase the number of job vacancies in the short-term – a number that fellow economist and panellist Izzuddin Yussof notes is dwindling.

Thus, the government should protect the existing workers instead.

“The thing that we can do is to introduce unemployment insurance. Last budget, they said they were looking at it; I hope this budget, they would say they are doing it.

“The beauty of this is that there is no cost to the government,” Mohammed told the audience.

He explained that it would cost only about RM5 a month to insure a worker to earn RM2,000 a month for three months, which is to be borne by both the worker and his employer. The median wage, he notes, is only RM1,700.

In addition, the best agency to implement this is already in place, he said, namely the Social Security Organisation (Socso).
Muhammad also urged the government to improve its BR1M cash transfers by imposing conditions on it.

For senior citizens, he said, there should be no additional conditions imposed. For families with children however, the families would need to show their children’s report cards to prove that they are attending school.

“This is not new; many countries have done this. One of our closest neighbours – the Philippines – have done this successfully.

“So a few years down the road, that family is no longer on the BR1M list. We don’t want them to be on BR1M forever,” he said.
– M’kini/Malaysia Chronicle"