Published: 1 July 2014
In the first part of my article on subsidies for the
poor or the rich such as Umno-Putras, I drew attention to the subsidy cut on
gas that has come into effect and analysed its impact on poor- and middle-class
households.
In this second part, I shall look
at the area of subsidies for the cronies of the political elite which run the
country – subsidies which are beneath the radar, unaccountable, undeserved and
which have been partly responsible for the financial mess that the country is
now facing.
What should be in front line of
subsidy cut
What should comprise the first,
second or third rung of subsidy cuts to balance the national budget should be
open to national debate.
In what sector; and affecting which
beneficiary group and by how much? All these questions are important and
especially necessary since the government is facing pressure from several
powerful quarters for special treatment and preference in the country's
socio-economic programmes.
Subsidy cut in higher education
One sector that we should consider
subsidy cuts is higher education.
Although I am a strong advocate of
strengthening access to higher education, there must be a rigorous cost-benefit
analysis of public universities.
During the last 40 years, tens if
not hundreds of billions of ringgit have been spent on Mara junior colleges and
public universities where the enrolment has been skewed towards the Malays.
All these colleges and universities
have done badly with low educational standards and unemployable graduates.
Last week brought damning evidence
of the decline in the standards of public universities with not a single
Malaysian local tertiary institution placed in Asia's top 100.
The finding by the Times Higher
Education Asia University Ranking 2014 is worrying because in the 1970s,
Malaysian universities and colleges were acknowledged to be among the best in
the region.
Shocking disclosure on UiTM campus
construction 'piratisation'
Now is the right time to evaluate
this subsidy to public higher education using rational criteria and taking a
holistic and national rather than racial approach.
This is especially necessary in
light of recent disclosures that RM8.6 billion is being spent to privatise
construction of six UiTM campuses nationwide.
Besides the key question of whether
this new construction is necessary given the glut of UiTM graduates who cannot
compete in the job market, there are other questions as to how the public funds
will be spent and who benefits.
According to PKR MP and
whistle-blower Rafizi Ramli, “This is a repeat of the same in all privatisation
concessions of other UiTM campuses where each concession company has links with
Umno leaders or businessmen with close ties with Umno.”
Citing information from CCM, he has
claimed that Detik Utuh Sdn Bhd – where Tan Sri Tajudin Ramli is a majority
shareholder – holds a minority stake in Unitapah Sdn Bhd, which was awarded a
23-year concession to build and rent out the Tapah campus to UiTM.
Further, Rafizi made a shocking
disclosure that “every privatisation concession of UiTM branch campuses is
making profit for Umno politicians through rental that is a burden on the
rakyat”.
Besides Tajuddin, Rafizi has alleged
that Datuk Shahrir Abdul Jalil – the brother of former minister Datuk Seri
Shahrizat Abdul Jalil – had a stake in a company involved in the construction
of a UiTM campus in Negri Sembilan.
This is a serious charge, which
needs to be investigated by the anti-corruption authorities as well as made the
subject of a special and separate parliamentary inquiry, especially if there
was no open tender involved in the award of the concessions.
What we are seeing with educational
expenditure is a repetition of the massive abuse with toll road, water and
independent power producer (IPP) concessions.
Selected cronies are given a
licence to print money by the government through long-term concessions which
are negotiated behind closed doors and provide the concessionaires with
guaranteed profit.
There is no open tender, no
transparency, no competition, no cost-benefit analysis, and no papers or
disclosure available to the public except when a whistle-blower emerges.
When will the toll collection stop?
Why should the toll rate be increased when there are increasingly more road
users?
Perkasa wants more spoon-feeding,
subsidies for Malay businesses
The other major concern is the
grant of RM20 billion from Petronas under a revised pro-Bumiputera New Economic
Model (NEM) announced in September last year by the prime minister.
Not only does it appear that the
subsidy grant of RM20 billion is not enough to appease Umno-Putras but we are
now hearing arguments from Perkasa chief, Datuk Ibrahim Ali, that
Petronas's CEO, Tan Sri Shamsul Azhar Abas, should resign for saying that
Petronas belongs to all Malaysians, and not just to the Bumiputeras.
What we are seeing is another
attempt by rogue Umno or ex-Umno elements to hijack the nation's scarce
financial resources for the small group of Malay cronies (and non-Malay
partners) in the name of the NEP and affirmative action to assist the Malay
community.
Spoon-feeding the rich, such as
Ibrahim and undeserving Malay companies, will not come cheap. Poor Malays will
suffer as we can see clearly from the impact of the power price hikes.
And if that is allowed to happen,
not only are the poor Malays the losers but the entire nation as our fiscal
reforms will go down the drain.
Government should make the right
choice
Subsidies for the poor or rich?
Subsidies for bloated, inefficient and loss-making GLCs, such as MAS or
subsidies for small and medium-scale enterprises?
Subsidies for the benefit all
Malaysians or for Bumiputeras only? Subsidies for public universities to
produce unemployable graduates and to benefit concessionaires?
We still have time to make the
right decisions. But time and the nation's wealth and money are fast running
out. – July 1, 2014.
* Koon Yew Yin reads The Malaysian
Insider.
* This is the personal opinion of
the writer or publication and does not necessarily represent the views of The
Malaysian Insider.
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