Wednesday, October 24, 2012

Finance Ministry's Recalcitrant Over Ampang LRT Line Extension Project

If there is a good example of irresponsible and recalcitrant leadership and governance, the Finance Ministry of Malaysia epitomizes it all. 

Deputy Finance Minister Awang Adek Husin was grilled by Pakatan Rakyat MPs for insisting that the Ampang LRT line extension project was granted to George Kent (Malaysia) Bhd from the very beginning, despite leaked Finance Ministry documents showing otherwise.

"As far as I know, when a decision is made and when we have signed it, there are no more changes. No such thing. I don't know what documents you are talking about," Awang Adek told Parliament when winding-up the committee stage debate on the Finance Ministry's Budget 2013 allocation.

Awang Adek was responding to the query from Saifuddin Nasution (PKR-Machang, left) on why a leaked Jan 25 Finance Ministry's Procurement Committee (JPMK) meeting minutes bearing the prime minister's signature showed that Balfour Beatty was awarded the project, but it was later announced that George Kent won the project.

Awang Adek said that the authenticity of the leaked documents was questionable, adding that there have been other instances where the premier's signature was forged.Following this denial, Nurul Izzah Anwar (PKR-Lembah Pantai) interjected and challenged the deputy minister to declare that the leaked procurement documents were false.

NONE"I want an explanation if you are declaring that these documents are false. If you are, then we can use your statement here in Parliament to absolve (PKR director of strategy) Rafizi Ramli if he is charged under the Official Secrets Act (OSA)," Nurul Izzah (right) said.

Rafizi, who revealed the leaked documents to the press, has since been hauled up by police under the OSA.

This fact alone, Saifuddin then insisted, indicated that the documents were authentic.

However, Awang Adek responded to the challenge by saying: "I have never seen the document before. There are so many documents. Not all of them are real and some could be false."

Apparently, the company which was awarded the contract had fared badly at the evaluation stage. It was rated fifth among eight bidders.

Awang defended the government decision to award the contract to a company which did not top the technical evaluation process. This is precisely the problem with the government - continuous denial of favoritism. A lack of technical quality is reflected in a number of public projects including the Trengganu stadium, the Defence Ministry quarters and a host of other projects. 

The fact that the project was awarded not to the top rated company already merits an investigation from the MACC but this is not going to happen in Malaysia. 

Awang Adek added that even though George Kent had no prior experience in railway projects, it has appointed credible sub-contractors comprising international players. 

Rightly pointed by a few Pakatan leaders, this is no different from an Ali Baba dealing. At the end of the day, if the contractor sub contracts out to other international players why should they be awarded the project in the first place? Malaysians ended up paying more compared to awarding it directly to an international player who can do the job. 

It is a shame that a Ministry is openly practicing a ridiculous policy. No wonder they needed a Perimekar for the submarine Scorpene deal too and ended up paying an additional RM560 million in commission. 

Where is MCA when you need them to speak up on poor governance? Oh wait, they are too preoccupied with trying to scare the Chinese with hudud. Why should be afraid of hudud when we are not criminals? I would like to know how hudud law deals with corrupt officials.

Friday, October 12, 2012

Harping on Soros Puppet Regime Reveals a Lack of Political Agenda. Is Saifuddin Willing to Back Our Call for Anwar & Najib to Debate on Policy?

Deputy Higher Education Minister Saifuddin Abdullah is right to say that BN's tactic to accuse the Opposition for colluding with Soros to set up a puppet regime may backfire on the coalition. The allegations sound mischievous and absurd to the middle ground.

First, there is no evidence that Soros has any strategic interest in Malaysia. He does not have any major investment in the country. The man, regardless of his business shrewdness, has contributed to NGOs around the world that help to promote democracy. Granted, he may have his own agenda for funding these NGOs but it is not enough to suggest that Soros Soros wants to install a puppet regime in Malaysia.   

Saifuddin said he is more keen on promoting BN as a "product" rather than criticising Pakatan Rakyat, Soros, or human rights NGO Suaram. This is the most probable way for UMNO/BN to adopt rather than trying to demonize Soros, the Opposition, NGOs and the Christians. 

Its coalition partner, MCA, is playing another dangerous game which has a direct effect on the Malaysian social fabric. It has chosen to play with the Hudud fire, knowing fully well that it is impossible for Muslims to reject the spiritual code. It has a potential backfire effect too on the party which has been dependent on Malay Muslim voters to keep its 15 parliamentary seats in the next GE.

Now, the Opposition is alleging that PM Najib had met up with Soros too in New York. Does it matter? A tit for a tat perhaps, but it does not bring any demonstrable benefit to the political process in the country.

Politicians should cut the rhetorics and polemics. They should debate on policy issues and tell how us they intend to govern us differently and better. 

I would like them to focus on these issues:

1) How to improve governance by implementing a better check-and-balance mechanism to ensure the public sector lives up to its budget and size?

2) How to curb wastage, mistakes, corruption and delays to minimize budget leakages? 

3) How to create more jobs for the locals; not foreign cheap labour?

4) What is the right reform needed for our education system? How to keep the cost of education affordable by optimizing the capacity of public institutions? Malaysian students are paying exorbitant fees for private tertiary institutions that are more profit centric than developmental centric.

5) How can we improve public transport? Cut down on petrol subsidy for private vehicles? Reduce the burden of car loan? Put more money on public transport as a deterrent to private car ownership and to encourage the use of public transport?

If aspiring leaders of other countries can focus their debate on policy issues and governance, our Malaysian politicians should be able to do the same. We are electing policy makers and executives to run the country and not moral, religious or social police officers.

Let's bring on Anwar Ibrahim and Najib Razak for a policy debate. It could be a start of a sober and issue based politics. Is Saifuddin willing to back me on this call if he is serious about peddling 'products' rather than gutter politics?

Wednesday, October 10, 2012

Budget 2013: Both Pakatan and Barisan Should Focus on Job Creation

We have seen the budget presentation from both sides of the political divide. Both coalitions are addressing socio-economic issues through various forms of grants, subsidies and assistance. However, we have not seen much about the need to create jobs locally. 

At present, more than 30% of graduates are unemployed due to several reasons. Prospective employers opine that our local graduates lacked the necessary communication skills and English language proficiency. Some blame the attitude and excessive remuneration demand.

Whatever the reasons, there are several issues which must be addressed before the subsidy pie grows bigger in the near future. 

The Economist reported that the global economy would have to create 600 million jobs over the next 8 years. A number of developed economies such as Japan, South Korea and China are facing acute competition for jobs even though their respective economy is still growing.

Malaysia's problem is no different. We are not creating enough jobs at the top of the value chain to accommodate enough knowledge workers. The presence of more than 2 million low skilled migrant workers is a serious symptom of a lack of will to enhance quality and adopt value added processes. 

The economy must start looking at the possibility of hiring local workers to fill their manpower need. The government should focus on providing assistance and incentive to companies hiring more local workers instead of being overly dependent on cheap foreign labour. With Indonesia's economy growing, there is going to be a shortage of workers in the construction and plantations sectors. We need to prepare for the eventuality. The government needs to find out why locals shunned working in these sectors. Retail and F&B are also increasingly dependent on foreign workers.

According to the report, the “job engines” of the past two centuries were usually new technologies, such as the steam engine, electricity, new seed varieties, or new types of manufacturing. Growth was also driven by more trade, easier transport, instant communications, and better rule of law.

What's Malaysia new "job engines"? Apart from the costly LRT extension, what else has been planned to provide affordable and efficient public transport to the people?

Malaysia's export oriented economy is also facing immediate risk next year from the slowdown in our traditional export markets : US and Europe. Hence, less jobs are going to be created in the next year or so. What is the government going to do to ensure that the economy continue to create jobs?

Are we prepared for a shift in the economic structure if Malaysia is moving away from low cost to value added economy? Is our education system capable of producing enough skilled and trained graduates to serve knowledge economy needs?

There are too many answers which require the attention of both coalitions aspiring to govern the country in GE 13.

However, an unhealthy and highly personalised/abusive politicking out of the way. Politicians should focus on policy contestation and tell us what can they do to serve us.

Sunday, October 07, 2012

Minimum Wage of RM1,100 Burdens the Nation? Who's Right - Chua Tee Yong or Tony Pua?

Khairy Jamaluddin & Chua Tee Yong are opposing Pakatan's proposal to set the minimum wage rate at RM1,100 a month. Both the BN politicians are claiming that the minimum wage will add burden to the nation and people. These two politicians are definitely short sighted. 

A number of nations which have a minimum wage legislation and those who have seen their income per capita rising a few folds above Malaysia in the last 2-3 decades did not go bankrupt. In fact, Taiwan is a good example. It had disallowed low skilled foreign workers into the country since the late 80's in order to reserve more jobs for Taiwanese. 

Chua claimed that Malaysia has three million foreign workers and by giving an additional RM200 a month to these workers as pay, it will create an outflow totalling RM7.2 billion as they transfer money to their home countries. 

"If we implement the minimum wage of RM1,100, we will lose RM7.2 billion every year. The question is who will bear the cost of this RM7.2 billion? The answer is the rakyat!" 

Tony Pua argues that the Pakatan Rakyat’s proposed floor wage policy of RM1100 would not cause a RM7.2 billion annual capital ouflow, it would only reduce reliance on foreign workers. 

Tony is making more sense than Chua. This is precisely the intention of setting a minimum wage policy - to encourage local companies to think local when hiring and to enhance productivity. Enhancing productivity and relying on local manpower and talents are the only safeguard to guarantee our economic competitiveness. When Indonesia starts to create more jobs or when the Myanmar economy takes off full steam, the availability of foreign workers become scarce. 

It is evident that both Khairy and Chua do not belong to the new generation of leaders who are committed and keen to address the long standing socio-economic issue. We need a policy to help us address long term dilemma and over dependence on cheap labour to grow our economy. 

For this issue, it is clear which coalition is talking long term and which is merely being myopic and irresponsible.

Thursday, October 04, 2012

Stop Politicizing Taman Manggis Land

Since the company who had originally wanted to purchase the 1.1 acre plot of land in Taman Manggis has failed to obtain a license to build a private health and dental hospital, the Penang state government should retract the sale.

The land was originally reserved for public housing and it was put on sale by the Dap led government through an open tender. 

Penang BN has been critical of the sale and alleged that it was sold below the market price. State BN Youth leaders handed over RM224,073 to a representative of the Penang government in Komtar this morning.

"We're paying the one percent deposit today to show our sincerity and promises fulfilled. We are serious about this (purchase). 

“We have made history, for it is historic for an opposition party to buy land and build public housing," said Oh Tong Keong, who is state Gerakan Youth chief.

"We should enter the Guinness Book of World Records," he told reporters.

Yes, a Guinness Record should be accorded for the most absurd sale ever. The land does not belong to Dap but it should be held in trust by the ruling state government for the people.

It should not be politicized at all. It is irrelevant for Ng Wei Aik to ask how the BN Youth could gather that much cash.

It is important to note that Ng does not represent the state government and he, as a political secretary to the Chief Minister, does not have the power or locus standi to make a purchase offer to Penang BN on behalf of the state government. He has clearly overstepped his jurisdiction as a state assemblyman.

Penang Chief Minister Lim Guan Eng should take cognizance of unauthorized and unconstitutional representation of his political appointees. It is making a mockery of the whole state government process.

On the other hand, the Penang BN is only out to score a political point. As a political party, they should be accountable and transparent to the fund collected for the purchase. If the money is coming from private developers as claimed, there is a room for MACC to move in for investigation. What is the purpose/motive for the financial support?

I sincerely hope both coalitions can act in a responsible manner. The land belongs to the people of Penang, not a political prize. 

My critique of the state government's economic development policy remains the same; it is not sustainable to fund development through sale land or land swap. There is a need of a better economic development policy and it is a challenge for both Pakatan and BN to present their solution.

It is a shame that the Taman Manggis land has become a political pawn for both coalitions. It is unscrupulous and a sheer display of political arrogance!

Tuesday, October 02, 2012

Budget 2013: A Dilemma for Malaysians

By now we are already familiar with the items/goodies contained in the newly announced Budget 2013. Here are some of my concerns:

1) Education

The government has allocated RM3.7 billion for vocational training. This is a step in the right direction. To be successful, tertiary education (or paper qualification) can provide a head start but a good skill can provide a stable career opportunity. The government needs to rethink the current craze to simply produce more graduates but many of them have to send back for retraining in order to be employable. Some of these undergraduates would have done much better acquiring skills in vocational institutes.

The government must rethink the implementation of PTPTN (higher education loan) scheme. It has offered 20% rebate for those who intends to pay up within the next year and 10% rebate per annum to those who make timely payment. It is quite obvious that BN is taking the middle path in trying to respond to Pakatan's pledge for free education. However, the budge has not addressed a few critical issues.

First, the need to realign the PTPTN scheme. Priority should be given to students studying in the public tertiary and vocational institutions. At present, more than 46 % (and growing) of total tertiary level students are enrolled in private institutions. More than 540 private colleges have been established to take advantage of the PTPTN scheme. As result, there is a growing sense of over commercialisation of our tertiary education leading to over capacity, poor delivery and too profit oriented. On the flip side, public institutions are facing serious problem of running optimally and meeting their potential capacity. There are almost 60 universities in the country and more than 100,000 unemployed graduates too. A serious review of the PTPTN is a must before it sinks the whole tertiary education system and a great number of private institutions too. The BN government is issuing RM3-4 billion worth of bonds a year to fund the scheme.

The elephant in the room continues to be ignored. The government has not been able to address the issue of PPSMI. Apart from the budget provision for teachers' training, what is the right strategy to restructure the education system. Our education policy has always been about medium of instruction. This is definitely a wrong approach. The government needs a policy which ensures that our students get the best learning environment, contents, curriculum and delivery system.

Ironically, while the government is talking about creating 1 million jobs through its ETP initiatives there's a shortage of skilled labour in Malaysia. Brain drain is a major issue the government has been able to address apart from the creation of Talent Corp which has yet to show its full capability and ROI.

We need a world class approach to determine the scope, context and methodology of our education blueprint. At present, the disparity between those who can afford a good education and those who can't is way too wide. The government has not shown any interest to improve the quality and standards of public education in the country.

2) Human Resource

Malaysia is running its 14th year of budget deficit and yet it is acting like a rich nation. Its people shun blue collar jobs in retail, F&B, hospitality, manufacturing and agriculture sectors. Employers do not want to pay for better trained staff but preferring untrained and unskilled foreign labour. Do not be surprised if unskilled and semi-skilled foreign labour make up more than 20% of our total labour force of 12 million.

For many years running, the government has not been proactive enough to solve this issue. Wage rate is obviously one of the reasons locals are shunning these jobs. However, we should not allow this problem to continue. How is the government going to fix the problem?

The government has announced additional handouts to the group earning less than RM3000 a month. The one-off handout is only a temporary measure. To many, the sum is way too small to help out in any meaningful way. In short, the government should look at the labour situation and enhance jobs creation. It should put the money to better use.

Additional bonuses and allowances were given out to civil servants and pensioners. Again, these payments are not tied to KPI or performance. If any, these handouts are only contributing to additional operating cost for the government. The government should aim at paying better salary to a streamlined and efficient civil service and not a bludgeoning one.

At present, the economy is not creating enough good quality jobs and not paying enough to retain brains and skilled workers in the country. Employers are not willing to invest on technology or human resource because it would contribute to lower profit margin. As a result, we the consumers are the ones who suffer.

3) Cost of living

If you are a working adult above the age of 30 and earning slightly more than RM3000 a month, you are probably the most neglected group in the country. The government has failed to provide any effective remedy to respond to rising cost of living. BRIM 2.0 has been broadened to include more than 4.6 million people but this is tax payers' money including those who are barely making more than RM3000 a month. Tax reduction of 1% of the lower taxable income bracket is not going to alleviate their problem if cost of food, accommodation, transport, medical and education keep rising. There is a policy vacuum dealing with the acute rise in cost of living.

A lack of attention and assistance to this group of people is going to push out even more skilled and educated workers from Malaysia to other OECD countries.

We need a comprehensive solution not short term handouts!

4) Regional integration

Malaysian companies are slow at capitalizing on regional opportunities. Countries such as Singapore, Japan, South Korea, UK and US are actively looking for opportunities for their companies. We have spoken to a number of investors from the region. The common feedback is Malaysian companies are slow movers.

The government needs to do more to help our companies and businessmen to reach out to the region and capitalize on growing opportunities in the region. At the moment, only fairly large local companies have the resource and capacity to reach out on their own. The entire foreign office and trade mission structure has to be revamped. The government sends a trade officer who can't speak mandarin to China and has to appoint a politician to assist him. This is not a very smart move. It is not only ineffective but costly to us.

The Finance Ministry is eager to find out why Singaporean companies are willing to pay more compared to Malaysian companies. The issues I have raised above do give the government ample hints on what went wrong. We need a mindset change from the government. The racial profiling and affirmative action DNA must be replaced with a truly 1Malaysia DNA which takes a broader view to solve issues and formulate strategy for Malaysia.

Can the BN do it? What's your input on Budget 2013?

Who is Mukhriz Mahathir to Guarantee the Safety of Lynas & Rapid?

I said this many times before, politicians and political parties come and go but the disasters they helped to create do not go with them. 

The International Trade and Industry Ministry has assured Malaysians that a rare earths plant and a petroleum refinery due to come on-line soon will not end disastrously as previous disasters that happened in the region.

“The Union Carbide (in India) and Asian Rare Earth (in Perak) incidents happened decades ago. The technology then is not as sophisticated as now. Our environmental regulations are more stringent than in the 70s.

“Don’t worry... there is no problem that will happen,” said its Deputy Minister Mukhriz Mahathir during Question Time in the Dewan Rakyat yesterday.

He argued that Malaysia has strict environmental guidelines that must be complied with by all, including rare earths miner Lynas Corporation and the operators of the Rapid project in Pengerang, Johor.

“We will not allow them to continue with any project which contravenes the guidelines and affect the environment,” assured Mukhriz.

The approval process proves to be as uninspiring, not transparent and doubtful as Mukhriz's lame guarantee. The government gave Lynas a TOL despite not being able to comprehensively spell out the waste management procedure and process. Now, it is not clear if Lynas is going to use Gebeng as a permanent waste storage area or send their industrial waste back to Australia. 

If the rare earth plant is completely safe, as claimed by Mukhriz, why didn't Lynas build a plant in Australia instead of transporting the raw material/ore all the way to Malaysia?

Mukhriz is not qualified to offer this guarantee. Is he offering us a guarantee on behalf of the BN government? Is he open to lawsuits should the situation proves otherwise?

Yes, technology has improved since the disaster of Asian Rare Earths plant in Perak but the same cannot be said about our work ethics, culture and mindset especially that of our enforcement officers.

If Lynas and Rapid are allowed to go ahead despite huge public outcry, the BN should be ready to tear apart their 'People's First" manifesto. If these projects are allowed to run without considering the potential risks and mental anguish of the people, this government deserves to be voted out!