Datuk Dr Mahani Zainal Abidin, the chief executive of the Institute of Strategic and International Studies (ISIS), said the proposed reforms do not take into account Malaysia''s financial ability to fund the high-spending reforms which includes raising subsidies as well as providing handouts.
"Prolonging subsidies or redistributing the wealth of the country without taking into account the country’s economic growth will not be viable," she told Bernama in an interview here today.
As a consequence, foreign investors might exit the country, she said.
Pointing to Pakatan Rakyat’s reform plan announced at its national convention in Penang last December, she said it would be popular to introduce the suggested reforms but would be detrimental to the economy and nation.
Dr Mahani also said the economy would regress if the reforms were initiated and the government would lose the ability to subsidise and help the poor if the economy doesn’t grow.
"The reforms are basically not for economic goals but more for distribution, and no emphasis has been highlighted on how they want to grow the economy."
"This is definitely not favorable to the business community and the private sector," she said.
More than anything else, she said the flawed plan''s emphasis was not on growing the economy, but just re-distributing the wealth, from which certain quarters would be badly affected as the economic pie was not expanding," she said.
Likening the populist reform plans to welfare dished out in some European countries, she stressed that these countries compensated welfare payments with a high level of taxes to finance amenities and public service provided to their citizens.
In Malaysia, "you can’t have a welfare state economy with low taxes, and if they still push on with it, the country would have to issue a substantial amount of bonds to support its actions," she said.
If the bonds were raised to increase public sector salaries or maintain subsidies without generating growth or increasing income flow, investors would raise doubts as to how the country was going to repay its sovereign debts.
In the process, "Malaysia''s credit ratings would falter while the sovereign risk of the country would be very high, and investors will not buy the bonds as the funds to be raised will be viewed as an unproductive usage of money," said Dr Mahani.
On claims by the Opposition that they would need only about RM19 billion to pull off the reform plan, she said if the subsidies were reduced like the RM19 billion in gas subsidies given to independent power producers, it would spark off a chain reaction in hikes in electricity tariffs.
"Where is the money going to come from when prices of electricity needs to be maintained," she said.
If subsidised electricity given to factories in order to reduce cost of production was reduced, producers will have no choice but to pass on the higher costs to consumers.
As such, Malaysia will not be viewed as a competitive country for manufacturing products if the cost of production is on the high side, she said.
Even worse, investors would definitely be affected, as under the Pakatan plan, it looks like many entities providing public utilities would be re-nationalized.
"Their future will be very uncertain and exiting the country may be the only viable choice for them," said Dr Mahani.
“Upholding the rule of law and respecting agreements signed are very important in doing business, and to me, this is a contradiction to Pakatan’s plan as in their course of implementing reforms, they can just declare contracts signed before as null and void,” she said.
Dr Mahani also said that a more holistic approach should be taken as the rakyat’s welfare should be taken care of, but the way to do it was not to continue subsidies and raise nominal incomes, but expand and rejuvenate the economy, increase revenue and maintain Malaysia as a competitive country when compared with its peers.
"We must be realistic as the world is not perfect and there may be some constraints, if we do not live within our means."
"I think we have to take into account the implications to the country as a whole before anything is being undertaken,” she said. -- BERNAMA
PAKATAN Hanya Perlukan RM19 Bilion Untuk Rakyat
Source: http://anwaribrahimblog.com/2011/01/11/pakatan-hanya-perlukan-rm19-bilion-untuk-rakyat/
Kenyataan Perdana Menteri kononnya Janji 100 Hari Pakatan Rayat tidak dapat dilaksanakan atas alasan negara tidak berkemampuan membuktikan lagi UMNO/BN berselindung di sebalik penguasaan media untuk memadamkan fakta. Maka memandangkan isu ini mendesak dan menyentuh kepentingan rakyat dan negara, kami syorkan diadakan satu debat terbuka.
Tuduhan beliau bahawa Janji 100 Hari Pakatan Rakyat akan menjadikan negara muflis adalah dangkal kerana hakikatnya, UMNO/BN yang berhutang setiap tahun sehingga hutang negara menggunung. Laporan Ketua Audit Negara yang dikeluarkan pada 25 Oktober 2010 memberi amaran bahawa nisbah hutang negara kepada KDNK telah melepasi paras 50% buat kali pertama dalam sejarah negara.
Hutang kerajaan Malaysia bagi tahun 2009 meningkat kepada RM362.39 billion atau 53.7% dari KDNK. Malapetaka ekonomi ini berlaku di bawah pentadbiran Perdana Menteri sekarang sebagai Menteri Kewangan. Dalam tahun 2010, kerajaan melancarkan 19 program menjual bon yang membabitkan hutang tambahan bernilai RM58.1 bilion.
Tabiat berhutang UMNO/BN akan diperhebatkan tahun ini. Pada 14 Disember 2010, Bank Negara Malaysia mengumumkan kerajaan akan menjual 29 bon tambahan dalam tahun 2011. Menurut anggaran Institut Penyelidikan RHB, penjualan 29 bon ini akan membabitkan hutang baru kerajaan persekutuan berjumlah RM83 bilion.
Makanya, alasan Perdana Menteri untuk menolak Janji 100 Hari Pakatan Rakyat perlu dikaji dengan berlatar belakangkan perkara-perkara ini. Malaysia sememangnya sedang menuju ke gerbang kemuflisan jika UMNO/BN terus berhutang sewenangnya seperti sekarang – tetapi ia bukanlah disebabkan oleh Janji 100 Hari Pakatan Rakyat. Malaysia akan muflis akibat ketagihan UMNO/BN kepada pembaziran dan rasuah yang berleluasa, demi mempertahankan sistem kroni kapitalisme yang didokong UMNO/BN.
Contoh-contoh pembaziran UMNO/BN sudah diketahui rakyat. Perdana Menteri terlampau taksub dengan bangunan 100 tingkat yang menelan belanja RM5 bilion, sedangkan isu perumahan mampu milik meruntun golongan berpendapatan rendah dan orang muda. Kerajaan UMNO/BN akan mengugut bahawa negara akan muflis setiap kali Pakatan Rakyat memperjuangkan imbuhan tambahan para guru, tetapi ia tidak rasa bersalah apabila meluluskan kontrak RM77 juta kepada APCO. Senarainya terlalu panjang untuk dihuraikan disini.
Oleh itu, tindakan pertama Kerajaan Pakatan Rakyat adalah melancarkan perang habis-habisan menentang rasuah di setiap peringkat, bermula dengan pemimpin-pemimpin kanan politik. Ini akan menyelamatkan RM28 bilion yang tiris dari Perbendaharaan setiap tahun akibat rasuah, seperti yang dianggarkan oleh Ketua Audit Negara.
Selepas itu, Kerajaan Pakatan Rakyat akan menstrukturkan semula sistem subsidi untuk memansuhkan subsidi korporat yang hanya mengkayakan beberapa kerat kroni. Jumlah RM19 bilion subsidi korporat yang ditanggung oleh PETRONAS untuk membayar IPP milik kroni akan dipulangkan kepada Perbendaharaan. Kita juga akan menyemak semula sistem konsesi toll untuk memansuhkan bayaran pampasan RM4 bilion setiap tahun yang kini ditanggung kerajaan.
Dua tindakan yang mudah ini akan memulangkan RM51 bilion kepada rakyat – lebih dari cukup untuk melaksanakan Janji 100 Hari Pakatan Rakyat yang jumlahnya hanyalah satu pertiga dari jumlah yang diselamatkan:
1.Imbuhan khas perguruan berjumlah RM500 sebulan menelan belanja RM3.2 bilion setahun.
2.Jaminan Pakatan Rakyat bahawa subsidi minyak akan dikekalkan untuk golongan berpendapatan rendah akan melibatkan penstrukturan semula sistem subsidi, supaya hanya golongan yang berkelayakan menikmati subsidi minyak. Kos subsidi di bawah sistem sebegini dianggarkan berjumlah RM4 bilion setiap tahun.
3.Kerajaan Pakatan Rakyat akan meneruskan subsidi gas memasak, berjumlah RM4 bilion setiap tahun.
4.Penstrukturan semula sistem tol di bawah PLUS dianggarkan menelan belanja RM23 bilion, berdasarkan harga pasaran yang ditawarkan oleh Khazanah dan KWSP. Kos tambahan yang perlu ditanggung kerajaan untuk mengambil alih operasi dari pemegang saham minoriti dianggarkan berjumlah RM8 bilion.
Justeru, jumlah dana yang diperlukan untuk melaksanakan Janji 100 Pakatan Rakyat hanyalah RM19.2 bilion; yakni sama dengan subsidi korporat yang diberikan kepada IPP milik kroni setiap tahun. Jumlah ini adalah terlampau sedikit berbanding RM51 bilion yang hilang setiap tahun akibat ketirisan dan rasuah demi memastikan kroni gembira dan bersenang-lenang.
Janji-janji lain seperti skim air percuma dan skim wi-fi percuma telah pun dilaksanakan di negeri-negeri Pakatan Rakyat. Kami telah membuktikan ia mampu dilaksanakan.
Oleh yang demikian, Perdana Menteri tidak boleh berdolak dalih lagi kenapa UMNO/BN tidak mahu melaksanakan Janji 100 Hari Pakatan Rakyat apabila rakyat tahu bahawa ia mampu dilaksanakan. Tabiat berhutang UMNO/BN yang membebankan generasi akan datang adalah sangat tidak bertanggungjawab, apatah lagi apabila wang yang dipinjam tidak dibelanjakan untuk rakyat.
DATO’ SERI ANWAR IBRAHIM
KETUA PEMBANGKANG
11 JANUARI 2011
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PAKATAN ONLY NEEDS RM19 BILLION TO IMPLEMENT 100-DAY REFORM PROGRAMS
Prime Minister’s repudiation of Pakatan’s 100-day reform programs on financial ground will further highlight UMNO/BN’s reluctance to spend the national wealth for the people.
It is a bit presumptious for the Prime Minister to claim that Pakatan’s 100-day reform program will bankrupt the country, since it is UMNO/BN-led government that had borrowed excessively each year. The Auditor General’s Report released on 25 October 2010 cautioned Putrajaya that the national debt to GDP ratio has breached the 50% mark for the first time in our history.
Malaysia government’s debt for 2009 rose to RM362.39 billion or 53.7% of GDP. The level of national debt in fact worsens under the stewardship of the current Prime Minister. The government undertook 19 bond programmes with a combined value of RM58.1 billion in 2010.
On 14th December 2010 Bank Negara Malaysia announced that the government will launch 29 additional bond programmes in 2011. RHB Research Institute estimates that this will involve a combined value of RM83 billion of new debts to be undertaken by the Federal Government.
Therefore, the Prime Minister’s criticism in rejecting Pakatan’s 100-day reform program should be viewed in this perspective. Malaysia is en route to bankruptcy at the rate that it is raising debts to fund UMNO/BN’s addiction to wasteful spending and corruption that is endemic in the crony capitalism structure that it props.
The public is generally privy to such examples of excesses are well known to the people. Instead of providing homes to the poor and young people, the Prime Minister is more obsessed with his 100-storey tower costing RM5 billion. The UMNO leadership will scream bankruptcy each time Pakatan fights for better pay for the teachers, yet it has no qualms to pay RM77 million for a one year contract to APCO. The list is endless.
Thus, the first action of a Pakatan Federal government is to announce an all out war against corruption at all levels in the government, starting with the political leadership. This will save an amount of RM28 billion for the national treasury as estimated by the Auditor General, believed to have been lost each year due to corruption and leakages.
Next, a Pakatan Federal Government will restructure the national subsidy system to abolish corporate subsidies that had bled the people and enriched only a few cronies. The RM19 billion of subsidy to IPP borne by PETRONAS each year will be reverted to the national treasury. Similarly, we will undertake an overhaul of the toll concession system to return the RM4 billion’s worth of compensation paid to concessionaires back to the national treasury.
These two quick actions will yield an additional RM51 billion financial muscle for a Pakatan Federal Government to implement our 100-day reform programs, whose cost is only a third of the amount:
1. The new RM500 a month teaching allowance for teachers and educational officers will cost RM3.2 billion annually
2. Our guarantee that fuel subsidies will be maintained for lower income group will involve a restructuring of the subsidy system, so that only the lower income group enjoys fuel subsidy. The cost estimate for maintaining fuel subsidy under a restructured subsidy system is RM4 billion annually
3. Pakatan Federal Government will continue to subsidise LPG, at an estimated cost of RM4 billion annually
4. The restructuring of the toll system under PLUS is expected to cost RM23 billion, based on the current offer made by Khazanah and EPF. The additional cost to acquire minority shareholders is approximately RM8 billion.
The additional cost required to fund Pakatan’s 100-day programs is only RM19.2 billion, an amount equivalent to the existing corporate subsidies fed to IPPs each year. This is a pittance compared to the RM51 billion stolen from our national economy to keep the cronies afloat and fat.
The other people-centric programs such as free water and free wi-fi schemes have been implemented in Pakatan states. This has been proven to be viable and sustainable.
The onus is for the Prime Minister to come up with a complete explanation of his reluctance to implement these programs, when rakyat knows that we can afford it. It is utterly irresponsible to continue piling debts for future generations to bear but refuses to utilise the money for the welfare of the people.
DATO’ SERI ANWAR IBRAHIM
LEADER OF OPPOSITION
11 JANUARY 2011
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