Tuesday, October 7, 2014

2 million families still earn below RM3,000, says minister

BY MUZLIZA MUSTAFA



Minister in the Prime Minister Department Datuk Seri Abdul Wahid Omar said today that two million Malaysian households still earn less than RM3,000. – The Malaysian Insider pic, October 7, 2014.  
Minister in the Prime Minister Department Datuk Seri Abdul Wahid Omar said today that two million Malaysian households still earn less than RM3,000. – The Malaysian Insider pic, October 7, 2014.

About one-third or two million Malaysian households still earn less than RM3,000, Minister in the Prime Minister Department Datuk Seri Abdul Wahid Omar said in Parliament today.
He said this figure was 28.7% out of seven million households in the country.
Income for these households was still suppressed despite an overall increase in the earnings of the bottom 40% of households.
The increase was an average of between 8 percentage points and 10 percentage points annually since 2009, based on surveys conducted by Putrajaya, Wahid said.
He was answering a question by Kuala Selangor MP Datuk Irmohizam Ibrahim, who wanted to know the rate of increase in income, and whether it was in line with the New Economic Model's target of increasing per capita income by 2020.
Irmohizam also wanted to know if the increase was able to meet the rising cost of living.
Wahid said that despite income growth being "on the right track" as well as various government initiatives to help the low-income group, Putrajaya could not be too comfortable as there were still many who earned less than RM3,000 a month.
Studies carried out over the past five years, however, showed a steady increase in overall household income in the country, Wahid said.
These studies were based on United Nations' standards and were done twice over the past five years, he added.
“The last time we did [this] was in 2012. Now, the National Statistic Department is doing a study on household income and household expenditure.
"Based on the initial data on average income, we saw an increase of income from RM4,025 in 2009 to RM5,000 in 2012, while this year the average household income was RM5,919."
Specifically on the middle income group, Wahid said average income was RM2,830 in 2009, before rising to RM3,626 in 2012, and RM4,258 in 2014.
This was an increase of 8 points annually over the past five years.
At the same time, the consumers’ price index increased from 98.3 to 110, a yearly 2.3%.
Wahid said this meant that growth in household income was more than the inflation rate in the last five years.
The studies have also shown a 10-point increase in the earnings of the bottom 40% of households, Wahid said.
Earnings of this group was an average of RM1,440 in 2009, then RM1,847 in 2012, and RM2,312 this year.
Wahid attributed the "steady increase" in household income to government initiatives that focused on the bottom 40% group. These initiatives were the introduction of the minimum wage, the 1Malaysia People's Aid (BR1M) fund, and other programmes aimed at increasing access to jobs and business opportunities.
Growth in the incomes of households drawing RM3,000 previously was also evident, with 61.3% earning more than that in 2012.
This grew to 71.3% this year according to initial data collected in the statistics department's continuous study.
“This leaves 28.7% or 2 million households, out of seven million households, still earn less than RM3,000 a month,” said Wahid.
To tackle this, he said Putrajaya will intensify efforts create more jobs and business opportunities to increase the incomes of this group.
“The government will continue to focus on the bottom 40% of households. Focus will be given to social development and aid to help them in facing the rise in cost of living.
"The government will continue to give aid, build affordable homes, open more Klinik 1Malaysia and others so Malaysians can enjoy a good, quality life.”
Wahid, however, did not address the question raised by Pokok Sena MP Datuk Mahfuz Omar, who asked  his opinion on a recent speech on the income gap and corruption by the Sultan of Perak, Sultan Nazrin Shah.
The sultan, speaking at the 47th anniversary celebration of the Malaysian Anti-Corruption Commission,  said Putrajaya had to stop being in denial about wealth inequality and realise that hardship and poverty were also fuelling corruption.
He cited figures that showed the low earnings of a vast majority of households and noted that those struggling to make ends meet were exposed to petty corruption.
Sultan Nazrin's speech followed debate over Wahid's earlier announcement that average household incomes have surpassed RM5,900.
The sultan had cited the New Economic Model report which showed that 80% of households earned less than RM5,000 a month, and of this, 40% were earning less than RM2,000 a month.
The data also showed that 78.6% of Employees Provident Fund account holders were those earning less than RM3,000 a month.
Sultan Nazrin said the data was worrying given Putrajaya's efforts to be a high-income nation with a target of RM48,000 income per capita by 2020. – October 7, 2014.
- See more at: http://www.themalaysianinsider.com/malaysia/article/2-million-households-still-earn-below-rm3000-says-minister#sthash.lKFR7wph.dpuf

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