Malaysia, in the eyes of the world, has successfully embarked on a growth with redistribution strategy over the past five decades.

As reported in the 9th Malaysia Plan, GDP in real terms grew at an average of 4.5 percent in 2001-2005 and GNP per capita increased by 5.7 percent in 2005.

Income disparity ratios between bumiputera and Chinese, as well as between bumiputera and Indians, have decreased without a reduction in household income for any ethnic groups.

But this is not to say that Malaysia's growth trajectory is without weaknesses. Its heavy reliance on foreign capital and failure to nurture globally competitive local firms are well identified by academicians to be some of the core weaknesses that rendered Malaysia vulnerable to global production cycles.

With the rise of China and other low-cost emerging economies like Vietnam, coupled with changing global production strategies, it is perhaps timely for Malaysia to reconsider some of the more specific elements of its growth with redistribution strategy.

This is further fuelled by the emergence of other forms of inequality that has caused discontent among Malaysians that may warrant a shift in Malaysia's redistributive policies.

The policy on JPA scholarships is one such element which must be considered against this backdrop.

university students 050805 in classroom The annual controversy over JPA scholarships has revealed a fundamental confusion over the real objective of this scholarship; whether it is aimed at quality human capital formation to propel Malaysia to be globally competitive, or meant to give the underprivileged a chance to compete on a level-playing field.

There is a place for both merit-based and need-based scholarships, but the both must be conceptually separated and administered differently.

Merit-based scholarships must be linked to Malaysia's industrialization and technological upgrading efforts. The purpose of this is to provide a continuous flow of quality workforce to solve the human capital bottleneck problem in Malaysia's effort to move to higher value-added production and activities.

Five implications

There are five implications. Firstly, a merit-based scholarship by definition rules out race as a criterion of selection.

‘Merit' must be defined in the broadest sense to include academic and non-academic achievements and aimed at retaining the best brains in the country. No one should be discriminated on the grounds of race, gender, religion, disability, political beliefs and sexual orientation.

Secondly, the 20 percent currently allocated based on merit under JPA is acutely insufficient.

Given the intense and demanding conditions of technological upgrading in the country, competent and competitive human resources, especially in the field of engineering and science, are needed at every level of the labour market - from government bureaucracy, academia and the industries.

Thirdly, there must be improved efforts in enforcing contractual obligation for sponsored students to return to Malaysia.

While no empirical evidence is as yet forthcoming, grapevine has it that many sponsored students actually flouted the contract by working overseas and paying back in stronger foreign currencies. The inefficiency of the Public Services Commission in finding matching jobs for returning scholars is also not helping the matter.

dap scholarship for top scorer memo at pm office 180509 01 Fourthly, the job attachment for returning scholars must not only be confined to the public sector. JPA can share its database of eligible scholars with the private sector or pass them on to a body that facilitates government-business partnerships such as MIGHT (Malaysian Industry-Government Group for High Technology).

Fifthly, as pointed out by DAP's PJ Utara parliamentarian Tony Pua, using A-levels/STPM examinations together with selected universities and courses, could be a better benchmark than the current usage of SPM.

Students who performed well in SPM can still do badly in their A-levels/STPM or choose courses which are irrelevant to Malaysia's industrialization and technological upgrading efforts.

Need-based scholarships should be linked to the goal of fostering a united and more equal Malaysian society for all.

Therefore, it is one form of redistribution aimed at helping the less-privileged to catch-up given their initial disadvantages in order to compete on a level-playing field.

Three reasons

There are three reasons why ethnic quota should also be abolished for need-based scholarships.

In the first place, there is simply no need for an ethnic quota as all deserving under-privileged candidates should be given financial assistance.

Financially, this should be feasible if students are sponsored to study locally as evident by the large amount of loans dished out through PTPTN every year.

It can be given out in the form of a conditional loan tied to future wage rates, where students only need to repay if their earnings reach a certain wage threshold.

Secondly, the notion of inequality is as subjective as it is objective. While inequality between the major ethnic groups may have been the cause of the May 13 ethnic conflict, today's discontent is fuelled by other forms of inequality i.e. intra-ethnic inequality and regional inequality.

malaysians 050905 All ethnic groups have seen a deterioration in their Gini Coefficients from 1999 to 2004, with the worse being the Bumiputera ethnic group. Urban-rural gap has also increased from 1:1.81 in 1999 to 1:1.211 in 2004. It is imperative for need-based scholarships to address these new forms of marginalization and inequality.

Thirdly, as long as there are policies based on ethnicity, Malaysians will continue to view the world through ethnic lenses and perceive inequality through coloured glasses although this is really no longer the case.

This is not to deny the importance of ethnic identity but rather to point to the need to transcend our limitations by constructing progressive policies that celebrate our common identities rather than accentuate their differences.

In conclusion, both merit-based and need-based scholarships are important and play a crucial role in meeting Malaysia's growth and redistributive objectives.

However, they must not be confused with one another and should be administered differently as they constitute very different aims, selection criteria and types of enforcement.

The persistent fracas over JPA scholarships points to an urgent need, not only to revamp the entire scheme, but also to rediscover its raison d'être, given the evolving growth and redistributive needs of the country.

CHRISTOPHER CHOONG is a postgraduate student in SOAS, University of London, not funded by JPA but still intends to return home to serve the country.