I read the manuscript, there are too many issues, I’m lost as to where I should begin.
Let’s try to dissect 2 examples in "burdening the rakyat"
I want to seek the truth about this party, forget those sex scandals; I have no time for those things. It’s policies people, which will make or break us, look at the policies. Once we get it right, we have more chance for success.
If a politician job is to persuasive agruements, to convince us for votes, then it is my opinion that this buku Jingga is enough to open the eyes for undecided voters. I believed PKR is a weak party.
Jom Semak!
1 ) "Merombak struktur subsidi negara bagi mengurangkan subsidi kepada pihak swasta (seperti subsidi gas sebanyak RM19 bilion kepada penjana bebas) dengan memindahkannya bagi menampung perbelanjaan subsidi rakyat "
2) Introduce minimum wage
Dear En. Rafizi,
By far this is the most counter-productive thing in your strategy simply because it will sabotage your other promises of increasing employment, increasing income level, reducing poverty etc. PKR fail to take a wholelistic view and knock-on effect.
Malaysia's published unemployment rate is 3.1%. (For skeptics, criticize if you like but if you are incapable of producing a revised and conclusive percentage then live with it).
Malaysians are natural entrepreneur but if they are not doing business, they are either employed by the government or public sector.
I would like to focus the discussion on the employees of the public sector. Labour force is about 12.6m (11% agriculture, 0.3% mining, 29% manu, 6% cons, 53.6% services). I don't have breakdown by govt vs. public but from the split by industry it is obvious that largely of that 12.6m population are employed in the public sector.
PKR promise in their "harapan rakyat campaign" is to have minimum wage and increase disposable income. Man, that's tempting!
Unfortunately it's not an easy thing to do. In a popularity contest, one will make that magic pill solutions promise but a responsible and strong government will make tough decisions to find the balance. Is PKR a responsible government?
Jom Semak!
Disposable income is your take home pay after all the deductions (tax, etc).
In all countries around the world, Malaysia included, rakyat are still being taxed indirectly on disposable income and that depends on the consumption like service tax, value added tax, household tax and so on.
In some countries, people pay higher income tax and social contribution at outset, and therefore being taxed less in their consumption. In Malaysia, we are taxed pretty low; having almost 9 bracket of income tax level, the highest rate of tax is one of the lowest in the world.
Unfortunately, in Malaysia, especially in KL lifestyle, the middle class families are pushing their affordable boundaries all the time constantly demands higher disposable income all in the name of capitalism. It makes them a prime and easy targets for PKR.
Why am I telling you all this? I want to try to paint you a wholistic view.
The tone I'd like to set is the role of the public sector in supporting and employing the people, explain why disposable income is important.
As you probably know, public sector in Malaysia is a very competitive landscape; they offer much more attractive salaries and package than local government.
En. Rafizi has a lot of plans to reform this, he wants to introduce minimum wage. Will it work?
I was fortunate enough to see similar law implemented in Ireland where it turned out to be counterproductive. What happen is employees in public sector who normally offers high pay have now lowered the start pay to minimum wages. Also this forces a slow in salary rise because the based is fixed. This makes the market less competitive.
According to En. Rafizi, 4m people earns RM700 per month would benefit from this. If you think this is wonderful news, do ask him at what cost?
Let's take a scenario:
Assuming RM8 per hour x 8 hrs/day x 5 days/week x 4 wks per month = RM 1,280 per month.
He also said that 40% earning below average income of RM1,500.
So two things, if Rafizi plans to bump up the salary for 4m people to minimum wage of RM 1,280pm then he will sabotage the people who should start at RM 1,500pm
If he plans to bump up the min wage to RM1,500 then he expects employers to bear the cost of double salary.
If PKR sets minimum salary below RM 1,500 then En. Rafizi fails to deliver his promise to bring people to average earning level.
Think hard, minimum wages are not sets by skills sets (as not define by PKR).
Meaning it includes everybody à that all childcare cost, nanny or live-in help, gardener, drivers.
It's good for them and their well being but it means that PKR just penalized the disposable income for the middle class families. If normally you pay RM700 for your nanny, you must expect to pay at least double that, under PKR. You will be out of pocket by RM700 per month.
Naturally one would also expect to see unemployment rate to increase simply because small companies are unable to hire as many people as they did before. If they used to be able to hire 2 people at RM700, they now can only afford to hire 1 person at RM1,500, worst because this one person now have to do a job that is for 2 people. So, if we use PKR numbers, out of the 4m million people, potentially only 2m people will earn RM1,500 but the other 2m people will be jobless.
In Europe, it is easier to impose minimum wage because they have a system for social security benefit. I used to work in Ireland, almost 52% of my salary goes to the government to support unemployed people and other benefits. They have a system to deal with poverty and job loss.
In Malaysia we do not have the same system. If we do, then the government needs to tax working class more, therefore we come back to this notion of sabotaging your own campaign for changing the "burdening rakyat" system.
En. Rafizi, what is the hope for potentially unemployed people?
En. Rafizi, I believe PKR do not take a wholistic view when drafting their plans, and certainly the more I read, the more obvious I see that each sweets you give to rakyat, you sabotage your purpose.
You mentioned in your manifesto that you aim for a better wealth distribution, but my opinion is what will transpire is you are re-allocating income to middle-class family and rich families. I believe in your plans, the low skill set workers and small companies will pay for this. We will be in a much worsen situation that we begin with in terms of disposable income.
I look forward to you reply and I hope you can address the following questions too…
· Can you please kindly reply as to how do you think the private/public sector will react to your announcements to cut subsidy?
· For companies listed in the stock exchange, can you please explain your prediction to their share price and the market reaction towards this?
· What are you expecting from foreign investors who have invested in our local company and their reactions to the increased cost?
· On what grounds do you think this would not impact rakyat directly given that many working class do have direct employees which is now subject to minimum pay too?
· If you decide to exclude them, please explain the fairness of your system?
· What will happen to small companies that employ lower skills people and now cannot afford to employ them anymore? Please explain in the context if small co. are unable to sustain these cost and they go bust, what is impact to the stats you initially start with, will improve or worsen.
If you disagree, then update your blog to explain how you see these two proposals can work.
My opinion, at the moment “buku jingga” is magic pill in "lala land".
Thank you.
-fida.i-
(Resources for those who are keen to explore more.
http://www.epu.gov.my/html/themes/epu/images/common/pdf/The-Malaysian-Economic-In-Figures-2012.pdf)
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