Statement by Lim Guan Eng in Petaling Jaya
on Monday, 14th April 2008:
CAT – competence, accountability and transparency in good governance,
especially in managing subsidies and our national resources
government should adopt a CAT system of good governance based on
competence, accountability and transparency, particularly the thorny
issue of managing subsidies and our national resources. Failure to do so
could be financially disastrous for Malaysia with total subsidies in
2007 expected to mount to RM 43.4 billion, accounting for 35% of our
2007 Budget's operating expenditure of RM 123.9 billion.
Last year, fuel and gas subsidies cost more than RM 35 billion.
According to the Information Department, rice subsidy has increased from
RM800mil in 2006 to RM900mil last year. Subsidies for wheat flour and
white bread cost the government RM364.8 million a year. Whilst the
increased efficiency from reducing subsidies is widely acknowledged, the
equity aspect and social protection provided by subsidies to assist the
poor can also not be questioned.
Second Finance Minister Tan Sri Nor Mohamed Yakcop could be accused of
being derelict in his Ministerial duties and failing to look after
public interest if the BN government can come up with a scheme to ensure
that government subsidies, especially fuel subsidies, benefit only the
poor and not the rich or those who can afford them. The public has a
right to ask that if there is such a scheme for subsidies benefiting the
poor but not the rich, why did Tan Sri Nor not implement it earlier
before the 2008 general elections when Tan Sri Nor was also the Second
Tan Sri Nor had said in Penang yesterday that the BN government does not
want to waste our subsidies on those who do not need them. Justice
requires that subsidies benefit the poor and not the rich. Public
interest also requires that subsidies must be managed efficiently and
effectively to ensure that there are no leakages, waste and abuses.
Has Tan Sri Nor only realized now that subsidies also benefited the rich
and are managed wastefully and inefficiently in Malaysia? It is easy for
Tan Sri Nor to say that the country should move away from an economy
with low-wage earners to a high-income, knowledge-based economy when we
are still reliant on foreign workers.
That is why in Malaysia, there are low income families that spend half
of their income on food unlike the United States, only about 16% of a
family's income is spent on food. For this reason, high inflation would
follow any removal of subsidies and impact most harshly on the poor.
What assurances are there that in reducing fuel subsidies the savings
earned by the government will not be wasted on corruption? But will lead
towards social projects that:-
the efficiency and quality of the country's public transportation with
an integrated plan combining sea, road, air and light rail network; and
benefits the poor against the harsh effects of inflation.
important questions with oil prices reaching record levels of US$110 per
barrel which would make the unsubsidised market price for petrol more
than double the present RM 1.92 per liter. That is why any savings from
any proposed reduction in fuel subsidies should be given directly to the
poor in the form of cash transfers.
DAP suggests a two-prong approach of firstly a RM 35 billion economic
stimulus plan of sharing oil profits of Petronas by giving each
individual earning less than RM 3,000 monthly a RM 3,000 yearly bonus
and each family earning less than RM 6,000 monthly a yearly oil bonus of
RM 6,000/-. This economic stimulus plan would rejuvenate the local
economy as most the money would be spent by the poor to buy their basic
necessities. And secondly, adopting a CAT system that can protect public
interest and prevent wastage by weeding out both the incompetent and
corrupt as well as those that has lost the democratic spirit.
Lim Guan Eng,
DAP Secretary-General, Chief Minister of Penang,
MP for Bagan & SA for Air Puteh