Archive for January 2015

High income nation with low wages workers

January 30, 2015

Minimum wages was introduced by ministry of labor after they found out that about 34% of private sector employees earn less than RM700 per month which is below the poverty line of RM800. Similar study in 2010 revealed that 48% of Malaysian employees earn less than RM1000 per month. While this being the ground reality but the Malaysian government wants the country to be high income nation by 2020. This situation prompted the government to implement minimum wages to attain the high income economy.

The national minimum wages of RM900 in west Malaysia and RM800 in Sabah and Sarawak introduced in January 2013 is up for review this year. In view of the increase in prices across the board last year and the imminent increase in price due to the implementation of GST, workers deserve an increase in minimum wages in 2015. While the MTUC wants an increase to RM1200 the Malaysian employer federation wants the old wages to remain as it is. Media report says the government would propose an increase to RM1000 to appease the employers.

Minimum wages is basic wages, excluding any allowances or other payments. But many employers like estate owners and factories have adjusted the salary scheme to include allowances and other payment to be part of minimum wages. Weak labor laws and government issuing Umno and BN cronies permits and licenses to bring in foreign workers has made employers addicted to foreign workers and discouraging the transformation to automation, self-service and high technology industries.

Foreign workers estimated to about 6 million both legal and illegal have suppressed and stagnated wages. Malaysian government took the easy route of attracting FDIs by offering low wages, unorganized work force and poorly skilled labor. The elitist BN government has amended laws to curb workers from unionizing and deprive them of their legal rights. Worker’s rights have deteriorated with only 6.44% of the 12.4 million private workers are unionized members.

Minister in PM’s office Datuk Seri Abdul Wahid Omar says government is looking into gradually increasing the ratio of wages to gross domestic product (GDP) from 33.6% to 40% in the long term. Government lacks new thinking and political will on transformation into higher value chain. In other countries like Singapore wages to GDP ratio is about 43%, Taiwan 46.2%, South Korea about 43.7%, Norway 51.3%, Australia 48.7% and japan 51.9%. While others have moved up, Malaysia remained stagnated in low wages by allowing Umno cronies to reap the profit by recruiting foreign workers in droves.

To quote a 2005 figure, for every ringgit earned in Malaysian employees get 28 cents, company 67 cents and government 5 cents unlike in Singapore employees get 42 cents, company 47 cents and government 11 cents. Workers in Malaysia are short changed by the government itself. Unless it is redressed the vision of high income economy in 2020 will remain elusive. Malaysia needs more political will and creative ideas to implement policies that will bring about structural changes in policy implementation than mere slogan chanting and scoring political points.

Malaysian workers deserve the MTUC proposed increase of RM1200 minimum wages and employers have the capacity to pay the extra RM300. Extra spending by workers will help the economy too. It is low wage earners who support the very government who keep wages down. Malaysian workers are disorganized unto race religion and partisan politics which is conveniently used by the ruling party to suppress wages. The ball is in workers court.

Revised Budget did not bring cheers

January 28, 2015

Malaysians are hard-pressed and at a loss as to the increasing cost of living when the international oil price has dropped rock bottom. In May 2014, the prime minister announced that with the high cost of fossil fuel, the government had no choice but to raise electricity tariffs by 15%. But when the fuel price dropped from US110 to US50 per barrel, all he could do was to postpone the next hike. Tenaga National Bhd’s latest yearend profit jumped 34.37% to RM2.34 billion.


On another note Putrajaya increased the price of RON95 from RM1.90 to RM2.10, and then reduced it to RM1.91. Malaysians did not experience a retail price reduction. School buses and transport charges have gone up. A wretched public transportation system has turned car ownership into a necessity. The prices of goods and services did not drop even in view of the global drop in oil prices. Consumers are the suckers and never the concern of the government.


The general public were waiting for some sweetener from the finance cum prime minister. Alas came disappointed. The finance minister did little to address the people’s concern. Malaysia recently faced its worst flooding in decades. Why there was no warning regarding the incoming monsoon winds and cloud movements. The finance minister never questioned this blunder of the agencies and instead announced a relief fund of about RM900 million. How did he come out such an astonishing amount in such a short period? He failed to make any announcements on steps to be taken in improving flood management and relief efforts. He could have announced the formation of a royal commission of inquiry in dealing with the catastrophe.


The finance minister also missed an opportunity to address the structural deficiencies in the economy – the bloated civil service, in this context. The finance minister announces an outcome based budget. Therefore when he announce a budget revision he should have announced the outcomes achieved or about to achieve. Outcomes are never announced. Ministry of education receives the highest allocation every year. But the quality of education is sliding downwards every year too. Internal security and policing always get priority. But public security and safety is becoming worse by the day. We have a national unity department for very long but the outcome is extremism and fundamentalism. The so-called outcome-based budget has achieved very little in terms of outcome.


Despite the government’s spending billions as provided in every Budget, the rural and urban Malays remain the poorest among those in the bottom 40% of households.  A large amount was allocated for the upgrading of skills of the workforce, including RM1.2 billion for the Vocational and Technical Transformation Programme. But only 28% of our workforce is technically skilled as compared to those in other developing countries – around 45%. Malaysia has a target of at least 50% in terms of a skilled workforce in 2020. While the government has never hesitated in spending to achieve these targets, they are hardly achieved and often, no one is held accountable.


The finance minister should stop the tabling of supplementary budget in every parliamentary sitting. It reflects poor financial planning. Malaysia is the worst affected country in the drop in international oil price. Besides the 16 years of continuous fiscal deficit, the current account surplus too is reducing. The finance minister has expressed his concern on our capacity to meet the current obligations. Malaysia is becoming a higher risk market. There must be drastic change and departure from past bad practices. Is the finance and prime minister bold enough to make radical changes to the way the economy is managed? He needs to emerge triumphant against the fiscal deficit, reducing current account, weaker ringgit and dropping revenue. He did not say much in the revised budget. It’s business as usual.



(Former Senator)




Government agencies sleeping on the job

January 22, 2015

Malaysia is facing an unprecedented flood in decades. More than 200,000 people have been evacuated and many motorists stranded on both sides of the flooded East Cost Expressway for days. The heavy northeast monsoon rainfalls are expected to cause maximum damage to the east coast states.

Prime Minister Datuk Seri Najib Razak, who was on vacation in Hawaii, had to cut short his holiday and return on Dec 27. He then announced an additional 500 million ringgit to aid victims after the flood subsides, following an initial government allocation of 50 million ringgit two days earlier.


Malaysians are disappointed that despite heavy rainfall of this scale, they did not receive any warning alert by the meteorology department and the national disaster management and relief committee.

The deputy prime minister too was overseas and returned on Dec 25 to receive a briefing from the National Security Council. By the time the PM and DPM had got their briefing and issued media statements, major towns in the east coast had already been submerged.

Why didn’t the national disaster committee, the National Security Council or even the meteorological department issue an alert well before the floods occurred? If cyclones and hurricanes can be forecasted days before they arrive, heavy rainfall too can be forecasted.

Early warning by the national weather centre on the forthcoming floods could have alerted residents to move out and all other flood relief efforts could have been made much earlier, thus reducing the economic losses suffered by flood victims.

CNN had reported one week earlier that strong high pressure developing over Eastern Europe and China, strengthening northeasterly winds from the South China Sea, would bring heavier rainfall over Malaysia, Indonesia and southern Thailand. And it was going to get worse. Another 100 millimetres (4 inches) of rain could fall over the next two days near the Malaysia-Thailand border, it said.

If CNN could give early warnings, why didn’t the Malaysian meteorology department too? Are  the National Disaster Management Committee, meteorological department and National Security Council sleeping on the job? Had they informed earlier, the Prime Minister too would not have gone to Hawaii to play golf with the US president.

All these events only confirm that our government agencies are totally unprepared for any disasters. They can do very little for people should any calamity happen.

It was only on Dec 28 that Tan Sri Muhyiddin Yassin announced that the standard operating procedures on national disaster management would be reviewed to increase efficiency in weather forecasting. He further added that Malaysia should learn from other countries’ disaster management systems, especially those of Japan and Korea. He also called for more waterways, canals and drains to be built.

Such a call in the middle of a crisis only confirms that the meteorology department, National Security Council and the National Disaster Management Committee are sleeping on the job. All these should have been done many years ago, not now when confronted with the worst flood ever.

Global warming and weather changes are not new phenomena. We all heard about the EL NINO effect on global climate change a long time ago which Malaysia too will have to face.

But the Malaysian agencies have not upgraded their weather forecasting, communication systems and skills. Because of the government’s failure to forewarn the flood-prone areas, many people were caught unprepared and could not remove their belongings.

On top of the 500 million allocated are other economic losses which will run into hundreds of millions in these challenging times. All these could have been reduced by timely warnings, but these the government agencies failed miserably to do. Let’s hope this despair at unsatisfactory standard operating procedures is taken seriously. Necessary changes should be brought about and problems not swept under the carpet.


We cannot stop natural disasters but we can be prepared to deal with it.

January 20, 2015

So much property wouldn’t have to be lost if there was enough disaster preparedness. The recent flood took Malaysians by surprise. Sludge water from rivers just overflowed swarming low lying areas and towns so quickly that people could not remove belongings and whatever removable on time. Worst of all the relevant authorities were caught unprepared for the disaster. There is no emergency government in place when the country was facing unprecedented flood. Government agencies were on year-end holiday mood and ministers including prime minister were on holiday.


This flood exposed the unpreparedness to forewarn and evict people form the low lying and near river bank settlements and towns. The government was totally absent during the flood and there was no coordination till the height of floods. Malaysians are not exposed, trained or briefed as what to do and where to look for help when faced with calamity.

Operation center or bilik gerakan does not spring up in affected areas coordinating and providing information as what are the affected areas and where are the affected people so that volunteers and relief effort can be directed. There was no central portal or website providing daily updates on flood situation, road accessibility, where relief effort is needed and victims are stranded. Besides there was no daily information on weather forecast for the different affected areas. However some websites and coordination came somewhat later.

The meteorological department issued a statement that they do not predict floods. But they can communicate a red alert effectively and forewarn of a possible flood under certain monsoon and cloud movement. If CNN can raise an alert this department has no excuse for not doing so. Please don’t pass the buck but take responsibility and improve for better service.

Malaysia’s greatest asset is its peoples’ willing to help each other without bothering about race or religion. The recent flood exposed the oneness of Malaysian spirit in times of disaster and the government’s hypocrisy of dividing the people into race and religion. Flood victims could see the Malaysian spirit and many commended on multiracial spirit of Malaysians. But the government controlled media are immersed in government propaganda that they overlook or just ignore these developments.

The current National Security Council must be dismissed as a total flop and replaced with disaster management experts who can formulate the institutional frameworks and standard operating procedures in the event of any natural calamity. Deforestation in east coast states must be stopped immediately. The need for disaster preparedness planning has never been more important in view of the climate change. Besides we have skyscrapers and multilevel flyovers and highways. Malaysians should be trained as to the operating procedures and coordination should there be a natural or manmade disaster.

It is time for Malaysian government to set a National Institute of Disaster Management for training and capacity development programs for managing natural disasters. Instead government agencies are putting up budget to buy more helicopters and boats for future floods. Government needs to set a team to study the weakness and unpreparedness and inquire why the meteorological department, National Security Council and Natural Disaster committee failed to forewarn, coordinate and manage the sudden flood before allocating money for purchases of assets.

Let’s learn from many other disaster affected and prone countries as to how to survive natural calamities and other catastrophic emergences. Climate change and man-made emergency events has to be taken seriously and the public must be trained and be prepared to face. Residents in local communities can come up with community based disaster preparedness measures by themselves. Even universities can be mobilized to research on Environment and Disaster Risk management and provide courses. Therefore a national institute of disaster management can lead the way towards better preparedness to facing calamities.

Nepal closes Malaysian visa-issuing company in embassy

January 20, 2015

The recent closure of the company operating from the Malaysian Embassy in Kathmandu by the Nepali government has opened a can of worms long- hidden from public knowledge. Malaysia VLN Nepal had been appointed by the Malaysian Home Ministry to execute the issuance of visas and had been operating for the past two years.

On Friday, (Jan 2), Malaysia VLN Nepal was asked to close down. A high-level Nepalese Parliamentary Committee on International Relations and Labour directed the Office of the Company Registrar to scrap the operating licence for Malaysia VLN Nepal. The reason was that this company did not have permission from Nepal’s Ministry of Foreign Affairs, Ministry of Labour and Employment and Ministry of Science,Technology and Environment to engage in the business of processing documents of Nepalis seeking Malaysian visas.

The company was also found to have had “shady deals”. It charged and collected Rs 3200 (RM 130) per visa but issued receipts for only Rs. 700 (RM 23). Malaysia VLN Nepal was the only company favoured by the Malaysian Home Ministry to execute the issuance of visas for almost two years.

Since the company was charging an exorbitant amount, the Nepali Parliamentary Committee has asked the Ministry of Home Affairs to retrieve the extra amount collected by the company from Malaysian visa seekers, reported the Himalayan News Service in Kathmandu.

Considering the fact that around 800 Nepalis leave for Malaysia for employment purposes every day, the visa-processing company thus generates an extra Rs 2.44 million for the embassy per day or over Rs 70 million per month. In the last year, ending July 2013, a total of 636,120 Nepali workers reportedly left to find jobs in Malaysia, making the country one of the biggest employers of Nepali citizens.

But the same Umno crony behind Malaysia VLN Nepal had also been appointed by the Home Ministry to execute the issuance of visas in India, Bangladesh and China. Such appointments cannot take place without the approval of the minister. In fact, the Umno crony is a state assemblyman from the Pekan Parliament Constituency. The interconnectedness in crony corruption in Malaysia is quite intriguing.

Malaysia VLN Nepal last month filed a request at the country’s Central Bank to transfer around Rs 30 million (RM997000) to Hong Kong and not to Malaysia. A high-ranking official at the Nepal Rastra Bank (NRB) said that all documents related to this request had been forwarded to the bank governor’s office for further inquiry as to why Hong Kong had been selected and not Malaysia.

It is indeed embarrassing for the Malaysian Government (Foreign Ministry) to allow a private company, Malaysia VLN Nepal, to collect money for visas and approve them on behalf of the Malaysian Embassy in Kathmandu. Home Minister Ahmad Zahid Hamidi should come forward to explain why a private company is allowed to operate within the Malaysian Embassy in Kathmandu and why there is a  need for a private company to issue visas and not the Home Affairs Ministry itself.