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(Petaling Jaya, Monday): Second Finance Minister Tan Sri Nor Mohamed Yakcop said on 10.2.206 that Malaysia’s economy grew by more than 5% in 2005 and the Government is not concerned about inflation at 3%. Very few Malaysians would agree with Nor Mohamed that inflation is not a concern when we have been paying higher prices. By stating that he is not concerned about inflation, only increases the likelihood of fuel price increase in 2006.
Clearly our economy has performed worse in 2005, as compared to 2004 when we enjoyed a growth rate of 7.1% and inflation of 1.4%. Further, many businessmen have complained about the drop in business last year despite registering a 5% growth rate and paying higher prices above the official 3% inflation rate.
Nothing has been done by the government to ensure that the people enjoy equally the benefits of the country’s economic growth. The failure to ensure equitable distribution of economic benefits is due to inefficiencies in the delivery system and extensive corruption such as no open tenders and cronyism where government contracts are awarded not based on technical know-how but political know-who.
The latest RM 756.7 million Metramac Corporation scandal where the Court of Appeal openly judged the then Minister of Finance Tun Daim Zainuddin of abusing his power to favour certain businessmen and companies, directors openly stealing and cheating their companies RM 32.5 million and misusing public funds of hundreds of millions of rinngit for the private benefit of few individuals. At the local level, we have appointed councilors refusing to uphold accountability and transparency when they go for expensive overseas junkets to “makan angin” at public expense. Is this where are assessment rates are going to instead of improving services, roads and drainage?
To curb inflation, Prime Minister Datuk Seri Abdullah Ahmad Badawi had promised on Sept. 7 2005 that it would halt further fuel price rises for 2005 and delay increases in highway toll rates until after 2006. However even this effort to check corruption may be doomed to failure if he fails to renew the promise that there will be no price increase in fuel price this year.
The possibility of a fuel price increase will not only help to raise inflation which rose to 3% in 2005, its highest level in seven years, as compared to only 1.4% in 2004. It will also lead to price increases in other essential items and goods used by a majority of Malaysians this year. Unless the government takes takes the lead by freezing price increases DAP expects the government to give Malaysians these 10 “ang pows” this year in the form of price increases:
1. fuel and gas;
2. quit rent as announced by some states such as Melaka, Negeri Sembilan and Perak;
3. assessment rates;
4. electricity tariff as proposed by Tenaga Nasional Bhd;
5. water rates after the privatization/corporatisation of water supply services is approved by Parliament in March this year;
6. insurance premiums of health card/medical care;
8. alcohol and beer;
9. university-related fees following the reduction of government assistance of 90% of government assistance to 70%; and
10. interest rates.
As these 10 “ang pows” of price increases are not accompanied by increases in salaries, they would have a severe impact on the financial budget on Malaysians. With 10 “ang pows” of price increases, the government has done nothing to reduce their burden, especially small-time businessmen and wage earners.
DAP urges the government to take the initiative by announcing a price freeze in essential items within its control such as quit rent, assessment rates, electricity tariffs and water rates as well as fuel. Such a prize freeze would at least help Malaysian businessmen and wage-earners to face the uncertain economic conditions of 2006 with the certainty that inflation is controlled. Only then can Tan Sri Nor by justified in saying that inflation is not a concern for Malaysians.