Thursday, 11 April 2013

PRU13: DO WE REALLY WANT 100% OF THE MANIFESTO?

The Election Commission (EC) has just announced that PRU13 will be held on 5 May 2013.  Both Pakatan Rakyat (PR) and Barisan Nasional (BN) have released their manifestos, in the case of BN, it is called ‘Akujanji’.  Each side claims the other side plagiarised its manifesto.  It sounds childish really.  I do not think many voters care whether they copy each other or not.  If the pledges are good for the country, it SHOULD BE in both manifestos.
 
In general, I find both manifestos disappointing and too populist.  On the economic side, there are no pledges to reduce government expenditure and debt although BN does pledge to reform the tax system.  Malaysia has been recording 5-6% annual economic growth in the past 5 years and yet the government spending continues to be in deficit, largely as a result of increase in government spending.  Can you imagine what will happen if Malaysia’s economic growth slump to below 3% or worst, suffer a recession?  The country could go bankrupt regardless which manifesto is implemented.
 
On the governance side, other than a couple of pledges to eradicate corruption, there is nothing much else in BN’s manifesto.  It is surprising since issues of corruption and lack of governance as a whole has been raised by many in the past few years.  PR meanwhile, has come out with quite impressive pledges to reform Parliament and other government institutions in its manifesto. 
 
For a start, I will touch on the strengths and weaknesses of each manifesto.  More points and arguments on specific pledges/ issues will be touched later.
 
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BN ‘AKUJANJI’
 
Strengths
 
"Reforming the existing tax structure towards a more broad-based tax system and gradually reducing personal and corporate tax”.  I guess this means Goods & Service Tax (GST) will be implemented.  Malaysia requires wider sources of revenues and a tax reform is very much needed.. especially when the government plan to give more handouts.
 
Opening 1Malaysia Daycare centres in all GLCs and Government offices and encouraging the private sector to do the same.  This initiative does not take centre stage in many media but daycare centres at workplace is a necessity and solve many problems.  It helps reduce a family’s expenses and reduce demand for foreign maid among others.
 
Weaknesses
 
The BN shoots itself on the foot by claiming “Malaysia needs a strong government” at the opening of its manifesto.  The impression given here is that Malaysia needs a government that controls 2/3 of Parliament.  The idea of a ‘strong’ government is so outdated.  What the rakyat ask for is a ‘fair’ government with proper governance that allows check and balance to its actions, not a ‘strong’ government that bulldozes policies without proper consultation in the Parliament.  It does not help either when the manifesto lacks substantial pledges to improve governance other than reforming MACC .
 
More and bigger cash handouts such as BR1M, 1Msia Book Vouchers and Schooling Aid.  Cash handouts DO NOT reduce poverty and DO NOT narrow the income gap.  These handouts will be hard to stop when it become an annual as recipients will see them as their ‘RIGHTS’ instead of ‘ASSISTANCE’.  Bear in mind that our huge fiscal deficit and debt might make these handouts untenable in the future. 
 
Some of BN's economic pledges are still race-based such as outsourcing GLC programmes for Bumi companies and providing seed funding to increase Indian equity.  It shows that BN is still going to implement race-based policies. 
 
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PR MANIFESTO
 
Strengths
 
Pledges made under “The People’s Government” to reform Parliament and other relevant government institutions are the manifesto’s strength and a huge one since BN fails to address these issues in its manifesto. 
 
Weaknesses
 
PR also resorts to cash handouts such as RM1,000 each year to senior citizens.  As I mentioned earlier, cash handouts DO NOT reduce poverty and DO NOT narrow the income gap.  Not all senior citizens need that extra cash anyway.
 
A minimum wage of RM1,100 per month. In general, i am against minimum wages especially when it is enforced across the board.  If the intention is to encourage higher distribution of profits to employees, employers should be incentivise to share their profits with employees.  Imposing higher wages will only make employers restructure their operating costs which does not necessarily benefit all employees. 
 
More subsidies such as lower fuel, lower electricity and water tariffs, abolishing tolls. and free public tertiary education.  In general, the PR government is re-allocating subsidies from companies to individuals.  These initiatives, although ‘attractive’ to voters, could add more strain to government finance.  Re-negotiating concession and IPP agreements, as well as liberalise the market will lead to lower prices for consumers.
 
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Looking at both manifestos, do we as voters want the winning party to implement 100% of its manifesto.  I for sure do not want that.  Implement the “good” pledges should be enough.
 
 

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