A time for solidarity, inclusiveness and equity

By William Leong Jee Keen

 

LONG before the pandemic came, our economy was already struggling to overcome severe difficulties.

COVID-19 only further exposed the vulnerabilities: the weaknesses of our social structures, the distorted political priorities, the imprudent economic policies and the deplorable living conditions of the lower income groups and the marginalised.

Many countries use their economic stimulus packages to restore lost jobs, save businesses and more importantly, redress deep seated racial inequalities and improve social justice.

Unfortunately, the RM325 bil Budget is not used entirely to assist those hit hardest by the pandemic and recession.

Instead the allocations are race-based to fish for votes, reinforcing social fractionalisation, divisiveness and inequality. Post COVID-19, those already behind will be left further behind.

Malaysians are disappointed with the disproportionate race-based allocations:

  • 1 bil to support Bumiputera development;
  • 5 bil to Bumiputera education institutions;
  • 6 bil to empower Bumiputera entrepreneurs;
  • RM500 mil from various schemes designated for Bumiputera entrepreneurs to increase their involvement in the key sectors.

But the disparity is clear when compared with the allocations to the other communities:

  • RM177 mil for the Chinese community for development of new villages;
  • RM100 mil for the Malaysian Indian Transformation Unit (MiTRA) to elevate the socio-economy of the Indian community;
  • RM20 mil for Skim Pembangunan Usahawan Masyarakat India; and
  • RM5 mil for entrepreneurship development for other minorities.

 

A new approach is needed

To foster economic recovery, this Budget should prioritise a more inclusive and multi-racial socio-economic development strategy and to target all ethnic communities equitably and fairly in the overall programmes and projects to be implemented.

A new approach is needed because the basis upon which the New Economic Development Policy was implemented which was an expanding economy, no longer exists.

Today, the economy is a shrinking pie but the Budget allocations continue to be distributed disproportionately in favour of one community. Those favoured will enjoy substantial benefits such as the following:

  • RM400 mil to write-off the interest of FELDA’s settlers’ debt;
  • RM750 mil to Pelaburan Hartanah Berhad to optimise the value of Malay reserve land in strategic areas to increase the value of Bumiputera holdings in real estate;
  • RM300 mil to encourage Bumiputera micro and small business to move up to a higher category;
  • RM300 mil to assist the SMEs that supply the Government or GLCs (which are Bumiputera companies in order to be awarded such contracts);

But those who have lost their jobs or income or badly affected by the COVID-19 pandemic will be left on their own:

  • When the Automatic Loan Moratorium ceased at the end of September, borrowers have to depend on the banks for extension of the moratorium;
  • The Targeted Wage Subsidy shall cease after three months, the 70,000 employers and 900,000 employees will have no assistance after that;
  • RM50 mil is allocated for training and placement of 8,000 airline employees but there is nothing for the those in industries also badly affected such as tourism, hotel, hospitality and retail;
  • 9,675 SMEs closed down during the first phase of the movement control order (MCO) from Mar 18 to June 9 2020 while 22,794 businesses closed from June to September during the recovery MCO. There will be more businesses closing down in the coming months.

With the race-based allocations in this Budget, post COVID-19 will see larger inequalities and greater misery. The results of the first prong of the NEP to eradicate poverty is not as impressive as previously claimed.

By this Budget’s acknowledgement that the Poverty Line Income is RM2,208 and not RM980, the boast that poverty has been reduced from 49.3% in 1970 to 0.4% in 2016 is not true.

The use of a very low and highly unrealistic poverty line obscured the reality that millions struggle to get by with tenuous access to food, shelter, education and healthcare with limited ability to exercise civil and political rights.

There is an urgent need for adequate funding to carry out far-reaching reforms to eliminate poverty by adopting a comprehensive social protection for all its citizens and providing essential support for non-citizens.

To achieve this, social cohesion and national unity must be strengthened first to put a stop to lies that lead to racial prejudice and discrimination. Why are the non-Malay poor not given the same opportunities as the Malays?

Rebuilding for the better

This is the time to prioritise a more inclusive and multi-racial socio-economic development strategy and to target all ethnic communities equitably and fairly in the overall programmes and projects implemented.

For the economy to recover, the whole community must come together and bridge their differences for a common cause. There is no alternative other than to rebuild Malaysia as a Shared Society.

A Shared Society is one where everyone has a sense of belonging, being respected and bound up with that a sense of responsibility and willingness to act for the good of the society as a whole and of every individual.

Business enterprises in Shared Societies can draw on a stable, more diverse and productive population, and access the skills and creativity, offered by all individuals.

Solidarity, inclusiveness and equity are the right things to do and they also make good economic sense. Left unaddressed, the exclusion of disadvantaged groups can be costly.

At the individual level, the most commonly measured impacts include the loss of wages, lifetime earnings, poor education, and employment outcomes. Racism and discrimination also have physical and mental health costs. At the national level, the economic cost of social exclusion is captured by foregone gross domestic product (GDP) and human capital.

For the reasons stated, unless substantial amendments are made as suggested, I do not support Budget 2021. – Nov 20, 2020

 

William Leong Jee Keen is the MP for Selayang

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