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Budget 2023: Six wishes that put people first

They will help reduce the economic stresses that the poorest 40% and middle 40% of households are currently facing

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Budget 2023 will be tabled belatedly on 24 February 2023.

It was initially tabled in late October 2022 as is the normal practice. But as Parliament was dissolved just a few days later, the Budget tabled by then Finance Minister Tengku Zafrul Aziz was not debated and voted on.

We in the Socialist Party of Malaysia (PSM) hope that the following six items will feature in the reworked budget that the prime minister, as finance minister, will table:

  1. An old age pension scheme of RM500 per month for all those aged above 65 who are not currently on government or Social Security Organisation (Socso) pensions. Such a scheme is urgently required as:
    • Though we do have the Employees Provident Fund (EPF), the cover it provides is neither comprehensive nor sufficient. At present, only about seven million of the 20 million Malaysians aged between 19 and 60 are contributing to the EPF. Another third have EPF accounts but are no longer contributing monthly. The remaining third in the 19–60 age group do not have any EPF savings at all – homemakers, farmers, fisherfolk, contract labourers, and operators of micro businesses. Most do not have any savings for their old age
    • According to the EPF itself, only 56% of members aged 54 years have EPF savings exceeding RM50,000. This amount is far short of the sum needed to sustain them in their retired years. According to the EPF, a member should have RM240,000 in EPF savings for him or her to be able to withdraw RM1,000 a month for as long as he or she lives
    • The pandemic and the drop in income forced people to rely on their EPF savings to survive. A total of RM145bn was withdrawn from the EPF largely by those who had the lowest savings to start with. So the low-paid workers are the ones who have depleted EPF savings now
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This pension scheme will give immediately relief to around 1.7 million Malaysians in the senior citizen category and make their conditions of life so much better. The scheme will cost about RM10bn per year at present, and it will be greatly appreciated by the public

  1. Socso contributions sponsored by the federal government to provide invalidity cover for all women aged between 18 and 60 in the country. If based on the minimum wage of RM1,500 per month, it will come up to RM15.50 per person per month. This works out to RM1.2bn per year to provide such cover for the 6.5 million women aged 19-60 who are eligible, ie women who are not government servants or currently covered by Socso

It is important that the government uses its database to initiate this scheme. Asking the women to initiate the process by making the first co-payment is a non-starter. It might sound good on paper, but very few of the eligible women will come forward and make the initial payment

  1. Increase the allocation to the Ministry of Health to at least RM44bn, from the RM33bn allocation for 2022. This still does not make the 4% of gross development product (GDP) target that many health advocacy groups have been asking for – that would be RM66bn. We advocate RM44bn for 2023 because we believe that the Ministry of Health will need some time to develop the programmes and the staffing requirements to be able to use the 4% of GDP allocation. But the plan should be to increase the health budget over the next five years to reach the 4% of GDP goal.
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The above three items will lay the groundwork for a better, more comprehensive safety net for all Malaysians and will reduce the anxiety that many feel when they consider their post-retirement future. In addition, the infusion of about RM18bn into the economy will expand the market for the micro and small businesses in Malaysia and lead to overall economic wellbeing for the poorest 40% and middle 40% of households

  1. A programme for urban low-income earners: The government should create a fund of RM2bn per year to co-sponsor a programme which mandates that local councils take over the upkeep and management of low-cost flats throughout the country. Many of these are in a deplorable condition because the management committees are unable to collect enough maintenance fees to keep the premises clean, repair broken lifts and pay the electricity bills for lighting in common areas. As a result, many low cost flats are unpleasant and unsafe for their residents. It would be a great disservice to the children and youth in these flats to allow the situation to fester
  1. A programme for the rural poor: There is no need for an additional allocation in this case. The government should ensure that there is transparency in the deployment of funds provided by the Ministry of Rural Development through the district offices to maintain and upgrade public facilities and rural residents’ houses. That allocation is currently about RM5bn per year! That level of funding must be maintained for now, but it will go much further when the pilfering (by local politicians and the district office employees and their crony contractors) is reduced by requiring all the allocations and the specifications of the projects approved to be put up on online notice boards, which the local population can access and monitor. The government should also beef up the Public Complaints Bureau so that complaints from the villagers that the allocations are not reaching the target are investigated speedily by teams from outside the state (and so relatively free of influence by the local elite). Those who misuse funds meant for the rural poor should be charged in court
  1. A simple announcement that the government has decided to withdraw from the Comprehensive and Progressive Agreement for Trans-Pacific Partnership so that it can carry out a proper review of the purported benefits of this economic agreement, would be the icing on the budgetary cake! Many economists agree that the CPTPP concedes too much to the wealthy multinationals and ties the hands of government at a time when the international situation requires that governments have the capacity to intervene decisively in the economy as and when required. The decision to step back and review the need for another free trade agreement when we are already committed to more than 15 bilateral and multilateral free trade agreements is a decision that Malaysians of varying hues will greatly appreciate
READ MORE:  A Budget 2024 wishlist for a more progressive Malaysia

The six programmes or actions sketched out above will help reduce the economic stresses that the poorest 40% and middle 40% of households are currently facing.

These programmes will also significantly allay the fears of the people who did not vote for Pakatan Harapan in the last general election that they will be neglected, marginalised or left behind under the new government. These proposals, if implemented, will definitely help widen the political base of the PH regime and represent an important step in the building of a more inclusive Malaysia.

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
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  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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Dr Jeyakumar Devaraj, a long-time Aliran member and contributor, served as Member of Parliament for Sungai Siput from 2008 to 2018. A respiratory physician who was awarded a gold medal for community service, he is also a secretariat member of the Coalition Against Health Care Privatisation and chairperson of the Socialist Party of Malaysia.
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Ms. Connie Chan
Ms. Connie Chan
11 Feb 2023 2.42pm

Hello everybody, just to contribute ideas re the issue of EPF.
Our government should adjust higher EPF interest to B40 and below inorder to make up the retirement fund with sustainable amount of money for retirement.
1. EPF interest high for poor and low for rich.
2. this is to change the EPF concept so that the rich gets lower interest rates and the poor gets higher interest rate to balance up our retirement group.
4. any how this will not affect the rich income group as their present income before retirement will already and surely be richer than poor income group. Rich high intellect poor low intellect

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