With a general election looming, it is speculated that Prime Minister Najib Abdul Razak will announce a significant salary rise for the nation’s 1.2 million civil servants in the 2012 Budget this afternoon.

However, a government economic adviser has questioned how effective this move would be in addressing the rising cost of living in the country.

asli budget 2008 forum 100907 dr mahani zainal abidin “What happens to those not in the public service? The wage issue is more acute in the private sector,” said Mahani Zainal Abidin ( right ), a member of the National Economic Action Council (NEAC), during a BFM radio talk show this morning.

Mahani expressed reservations on whether a pay hike for civil servants was the best solution to address the economic issues faced by Malaysia.

NEAC is the body established by the government to advise it on economic policies. Mahani is also the chief executive of the Institute of Strategic and International Studies (Isis), a think-tank that provides consultancy to the government.

Another guest featured in the talk show was Teh Chi Chang, executive director of independent think-tank Research for Social Advancement (Refsa). He was once the economic adviser to DAP secretary-general Lim Guan Eng.

Both Teh and Mahani were asked to comment on the speculated civil service pay hike.

civil servants government workers Teh questioned whether the government had taken into account the consequences of such a salary rise before implementing it because eventually it would translate into a huge amount of pension when these civil servants retire.

“This is the question we should ask,” he said.

The duo were asked whether the large number of civil servants, amounting to some 10 percent of the nation’s total workforce, should be trimmed.

While Mahani hoped the government could act “faster and more seriously” in tackling the issue, she pointed out that a clearer definition of 'civil servant' was necessary when discussing the issue.

Teachers and policemen are also categorised as civil servants, she elaborated, and the public demand for better quality education, such as smaller classes and more policemen to fight crime, would definitely increase the size of the civil service.

“We should look at the number of civil servants that only deal with government administration,” she said.

Civil service bloc wooed by both sides

Teh admitted that the 1.2 million-strong civil service is a significant voting bloc that both sides of the political spectrum are currently chasing by pledging monetary benefits.

The shadow budget proposed by Pakatan Rakyat also allocates RM5.9 billion to overhaul the civil service salary structure, bringing up the minimum wage to RM1,100.

Mahani was also asked on the comment by her late colleague, Zainal Aznam Mohd Yusof, that the second part of Najib Abdul Razak’s brainchild, the New Economic Model (NEM), had been ‘hijacked’ by a Malay rights group.

 

She disagreed with Zainal, arguing that the only NEAC proposals rejected by NEM were the abolition of the 30 percent bumiputera equity requirement and the proposal of an equal opportunities commission.

Mahani clarified that the rejection of the commission’s proposals was due to confusion because the council did not explain well to the government that the commission’s ambit covered both the public and private sectors.

On the bumiputera equity quota, she said the government did not back down, but merely set conditions form its abolition, which is to ensure that bumiputera companies developed sufficient competitiveness.

Mahani also criticised the Pakatan’s shadow budget for dishing out a cash payout to senior citizens and housewives as this will expand the subsidy.

“It is very difficult to withdraw once we give a cash payout... there must be programmes to move them out of the lower income group,” she said, adding that some housewives may have significant assets and therefore do not need financial assistance.

In response, Teh, who had been consulted on the shadow budget, argued that it aimed to maintain the previous subsidy amount set by the BN government, and it was coupled with other steps to eliminate wastage and corruption, as well as to increase the income of Malaysians.

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