Focus View
Time to downsize civil service
FocusM team | 10 Nov 2017 00:30
It’s extremely worrying that our civil service wages bill has increased rapidly over the years.

In 2010, the civil service wage burden was RM29.7 bil. In just seven years, it has ballooned to RM79.15 bil, taking up the biggest portion of the government’s operating expenditure.

With 1.6 million civil servants, Malaysia also has the highest ratio of civil servants to population at 1:19.37. In Indonesia, it is 1:110. 

The wage bill will only increase with salary adjustments, bonuses and pensions. In time to come, it will become untenable on the country’s finances, especially as the debt burden grows. Even a proposal to discontinue the pension scheme for civil servants has not gone down well. But can the government afford it? 

The government should seriously consider making it mandatory for new civil servants to contribute to the Employees Provident Fund (EPF) like those working in many statutory bodies. This will stop the pensions burden from spiralling out of control.
Early this year, a former top civil servant suggested that the government downsize the civil service. This was of course met with resistance by the Congress of Unions of Employees in the Public and Civil Services (Cuepacs). 

There is no valid reason for Cuepacs to blindly oppose any downsizing. Instead, it has to ask itself why there is a need for Malaysia to hire such a large number of civil servants compared to other countries?
Would it not be better if a smaller number of civil servants were paid a much higher salary? Wouldn’t that enable them to enjoy better perks and bonuses through higher productivity?  

Even government-linked companies (GLCs) have been downsizing in recent years. National airline Malaysia Airlines cut 6,000 jobs two years ago in a bid to return to profitability by 2019. Similarly, national oil company Petroliam Nasional Bhd (Petronas) cut hundreds of jobs last year amidst falling revenue. 

In 2015, Khazanah Nasional Bhd-controlled CIMB Group Holdings Bhd shed 3,600 jobs through a mutual separation scheme. The latest GLC seeking to cut jobs is plantation giant Felda Global Ventures Holdings Bhd which announced a voluntary separation scheme (VSS) for senior staff.

Like GLCs, the civil service should not be immune from job cuts. The government must have political will to do what is necessary to safeguard the country’s finances. 

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