Pakatan Rakyat’s Belanjawan 2013 – A Commentary

Pakatan Rakyat announced its Belanjawan 2013 (Belanjawan sounds nicer, isn’t it?) this afternoon.  You can download the full document HERE.

The Belanjawan is a people-friendly budget as expected.  Whether the numbers believable or not are arguable though.  Going through the document, I feel that the Belanjawan is city-centric (PR’s existing voter base) with less emphasis on rural.  The only major proposal with direct impact to rural areas is Pan-Borneo Highway (targeting East Malaysian voters).  There is only 1 page titled “Increasing Incomes and Employment Opportunities for Malaysians in Rural Areas”.  Overall, I feel the Belanjawan succeed in providing possible answers to current “hot issues” such as transportation, cost of living and monopolies in industries.

I won’t be going into details of the Belanjawan but below are my ranting on some of the contents.

Thrust 1: Increasing Disposable Income, Alleviating Economic Hardship

One of the proposals in this Thrust is the implementation of universal minimum wage of RM1,100 for the public and private sector.  Generally, I support the implementation of minimum wage but to make it universal across the board is very simplistic.  Cost of living is different between locations and productivity level is different between industries.  Thus, not all private sectors can afford to pay the same amount of minimum wages.  More detail studies shall be made to ensure each industry deserves its own minimum wages.  The same can be applied in the public sector.

Another proposal under this Thrust is the popular one.. abolishment of PTPTN as PR believes that tertiary education shall be free to all Malaysians.  I was not in favour of PTPTN when it was first created but for opposite reason.  I don’t believe everybody shall get a loan for tertiary study.  Some of them deserved to be fully or partially subsidised (based on performance and socio-economic status) while the rest shall pay if their families can afford it.  Furthermore, with increasing education costs and population, free tertiary studies will be a big hole in government budget in the future.

Thrust 2: Building Entrepreneurial Class, Promoting Constructive Competition

One of the proposals in Thrust 2 is to refocus all government investments and ventures into business in Khazanah Nasional.  I am a believer that government shall not venture into business.  Revenues to the government shall come from taxes and not dividend.  But as a developing country, it is understandable that government have to venture into some business for strategic reasons.  PETRONAS is an example. 

I will therefore go one step further to make Khazanah focus only on strategic investment and not compete with the private sectors.  Because of its strategic investment, the KPI shall not be minimum dividend as proposed in the Belanjawan.  KPI can be designed to ensure Khazanah’s focus remain on strategic investment.

Thrust 3: A Just Society With Dignity and Pride

One of the proposals under Thrust 3 is the establishment of state-owned second-tier oil and gas companies for oil producing states to benefit from risk-sharing contracts in marginal fields.  I find this proposal unnecessary as the issue at hand here is the awarding of these contracts to alleged cronies.  More transparent award process shall eliminate the issue.  We do not need many PETRONAS.  I would suggest that some of the royalties paid to the states to be used for investment in alternative energy in anticipation of lesser oil production in the future.

Now, waiting for the government’s budget this Friday..