Malaysia cannot afford further subsidy cuts because a large proportion of wage earners is living below the poverty line, the Malaysian Trades Union Congress (MTUC) says.

In the face of the spiralling prices of essential goods, it was even more necessary now that the federal government implements a minimum wage policy, MTUC president Syed Shahir Syed Mohamud said.

Citing a Human Resource Ministry study done last year, he said 34 percent of wage earners now earned less than RM720 a month and were therefore on the national poverty line.

"No caring government will raise the cost of living of a burdened people.

parliament pakatan pc on mtuc 031208 syed shahir "The present Malaysian government just does not care ... it has proceeded to increase the prices of basic items needed for human survival," Syed Shahir ( left ) said in a statement.

The recent hikes in the prices of petrol, diesel, liquefied petroleum gas (LPG) and sugar, he added, would have an overall inflationary effect.

Syed Shahir said the government had shown its insensitivity to the fact that many Malaysian households could not cope with the rises in the prices of basic commodities.

The government should not be cutting subsidies to save public funds but instead go on an austerity drive.

"The government must look elsewhere to cut government spending, such as by cutting defence spending and reducing corruption, which includes awarding ‘over-priced' contracts to cronies at all levels.

"MTUC reminds the government that it should be primarily concerned about the welfare and well-being of the ordinary people, including workers and their families," he added.