Home TA Online Anwar’s first anniversary as PM: Fix the economy and hasten reforms

Anwar’s first anniversary as PM: Fix the economy and hasten reforms

The PM cannot go on pandering to the 'old guard' and the conservative Islamic base, who are unlikely to change their minds no matter what he does

Anwar Ibrahim with other coalition leaders in his 'unity government' - AFIQ HAMBALI/PRIME MINISTER'S OFFICE

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One year after Anwar Ibrahim took over as Prime Minister, expectations have fallen.

Perhaps we have to be thankful his “unity government” has not collapsed to send the country into political turmoil again.

The bright side is the country is relatively stable, with no serious unrest on the streets.

Despite our RM1.5tn federal government debt, we are not bankrupt! Food prices have crept up, but we have no hyperinflation.

The economy appears steady, even if the ringgit has weakened.

So why has Anwar’s performance rating plunged from 68% last December to 50% in October, according to the Merdeka Center?

Likewise, his government’s approval rating has also fallen from 54% last December to 48% in October. That’s not all: 60% feel the country is going the wrong way, with 56% citing economic issues as one of the main reasons.

Look at household debt, which at 89% of gross domestic product (GDP) remains high, one of the highest in the region alongside Thailand. In contrast, household debt in Indonesia is just 17% and Philippines 10%.

That’s RM1.4tn in debt that the ordinary people of Malaysia have to bear on top of the RM1.5tn in federal government debt. Of the household debt, 58% of that is due to housing loans, another 13%, personal loans.

What’s more, many do not have enough retirement savings to cover expenses in their post-retirement years.

Why are so many people feeling financially squeezed? One clue is the labour share of national income has dropped from 37.4% in 2020 to 32.4% in 2022. Compare this with the labour share of over 40% or even 50% in many developed nations. What this means is that many workers in Malaysia are simply not getting a fair share of the national income for them to live comfortably.

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To be fair, these are long-standing structural problems in the economy, but they must be addressed.

One way out to ease the plight of many households in our ageing population is for Anwar to introduce a universal pension scheme for those without pensions. This much-needed financial aid would surely boost the government’s approval rating.

The Anwar administration has to improve our hospitals – it must raise government spending on the public healthcare system from about 2% of GDP to 4-5%. Reduce the queues and long waiting times at these hospitals. Hire more specialists and doctors quickly to spread out the workload.

For this to happen, the government has to widen its revenue base and its tax collection to strengthen the social security net. It could save some RM20-30bn a year by slashing corruption, ‘leaks’ and rent-seeking. Cancel unnecessary mega-projects – or look at cheaper alternatives – and tightly monitor government procurement.  

More funds could be raised by imposing wealth taxes on the super-wealthy and increasing sales taxes on luxury items.

The government must also reform the education system to raise the quality of national schools. It must find out why the ethnic minorities have moved to private or vernacular schools. The reasons are obvious: it doesn’t take a genius to figure it out.

Not fast enough

The good news is that there is no more mandatory death penalty. Now we must push for the total abolition of the death penalty.

Several reforms appear to be underway, but the pace could be quickened:

  • Separation of the public prosecutor’s role from the attorney general
  • A political funding act
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These would be welcome developments, if they materialise.

Progress has been made with an Independent Police Conduct Commission, but this lacks effective bite, and the government must look at what the 2004 royal commission on the police really intended.

Unfulfilled promises

Several key promises have not yet been fulfilled, including:

  • The vetting of key public appointments process by a special parliamentary committee – for the chief of the Malaysian Anti-Corruption Commission, election commissioners, public prosecutor, etc
  • The introduction of a parliamentary services act
  • The introduction of a government procurement act
  • The devolution of powers
  • A 10-year term limit for the prime minister and chief ministers
  • A fixed-parliamentary term
  • A review to correct the severe malapportionment of constituencies

A couple of key pledges have been broken:

  • Equal constituency funds for all MPs
  • Repeal of repressive laws such as the Sedition Act, Sosma, Section 233 of the Communications and Multimedia Act

Bersih has given the government a score of just 22% in fulfilling pre-election promises.

And when are we bringing back local government elections?

Major disappointments

The evictions of the Kanthan farmers in Perak and the reclamation in Penang that will degrade fishing waters are major disappointments. These two cases reveal a distinct lack of appreciation of the importance of food security.

We are simply not doing enough to boost the country’s food security. Getting large agribusiness companies to replace independent farmers is not the way to go.

The focus on mega-highways instead of ramping up improvements in public transport and inter-city rail services is also misguided. We don’t have a sustainable mobility masterplan for our major cities and towns that also looks at the needs of pedestrians, cyclists and bus users.

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Focus on key areas

The PM has to stress to the ‘old guard’ – the leaders of his multi-coalition government – that they have to work harder to fulfil the reform expectations among the public if they want this administration to survive.

The pace of reforms has been too slow for many. Granted, it is only the first year and Anwar has to balance the interests of his multi-coalition government.

But he cannot go on pandering to the old guard – and the conservative Islamic base, who are unlikely to change their minds no matter what he does.

Instead, Anwar has to target fence-sitters by focusing on how he can improve their economic situation and quality of life. He needs to focus on key areas like extra government funding for public healthcare, reforms to the education system, affordable housing, a living wage and a universal pension.

Work on the People’s Agenda, which over 50 civil society groups have endorsed.

There is not much time to lose.

The views expressed in Aliran's media statements and the NGO statements we have endorsed reflect Aliran's official stand. Views and opinions expressed in other pieces published here do not necessarily reflect Aliran's official position.

AGENDA RAKYAT - Lima perkara utama
  1. Tegakkan maruah serta kualiti kehidupan rakyat
  2. Galakkan pembangunan saksama, lestari serta tangani krisis alam sekitar
  3. Raikan kerencaman dan keterangkuman
  4. Selamatkan demokrasi dan angkatkan keluhuran undang-undang
  5. Lawan rasuah dan kronisme
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