Government must help the M40 employers

Norman Fernandez


LETTER | The government has rolled out a slew of measures to help the poor further. That include various financial assistance and even cuts and temporary reduction in payments of rental of government flats and houses. All these in addition to the Bantuan Sara Hidup.

While the government should be commended for assisting the poor, the government must realise that the poor and more specifically the B40 segment was already being assisted in various ways even before the Covid-19 crisis. The B40 segment itself has many avenues to seek help and was already being helped by the government and by NGOs to religious bodies. Thus, there is some cushion to alleviate their hardship. We must remember, this B40 segment does not pay taxes at all. They cannot afford it.

The civil servants, too, have the least to worry about. Their iron-clad bowl is neither broken nor there is even a dent. Their monthly salary is assured and secured. Thus, there is very little they need to do to change their lifestyle if they choose not to do so.

Thus it can be safely said the poor and the civil servants are far better protected and cushioned to face any downside from the Covid-19 pandemic.

By contrast, it is the M40 middle-class that is caught in between. The government is clearly seen to ignore the M40 segment who the government believes can fend for themselves and with minimal assistance. Thus, the government’s brilliant idea that the M40 segment can and should dip into their EPF savings and live of it for the next 12 months.

In short and in truth, the government has decided to leave the M40 segment high and dry - yet it is from this segment the government depends upon its taxes.

Worse off now, are the M40 segment who are self-employed, running businesses employing staff often from the B40 segment. It is regretful that the government believes that all professionals like doctors and lawyers or even someone running a small jewellery shop has the means of a comfortable and steady stream of income.

The government assumes that every doctor or lawyer or jewellery shop owner is not impacted by the Covid-19 crisis and that he or she has sufficient savings to live by and his business churns out enough income to run his or her business, pay the salaries for the staff and also assist the government by paying taxes.

The hard truth is that the M40 segment who are employers have been terribly impacted and are also suffering from the Covid-19 pandemic. Imagine having close their offices and business for a month and still pay staff salaries and other fixed monthly expenses.

The government is giving nary care and two hoots for the employers in the M40 segment. Thus, the governments directive that employees have to be paid in full, never mind there is a “lockdown” and uncertainties reeks of a callous attitude by the government.

The government must give the private sector, in the present circumstances, the leeway for them to take whatever measures to help protect their businesses and the jobs of their employees. Thus, the government ought to equally pay attention or rather more attention to this M40 tax-paying and job-providing employers.

Hard as it may be on the employees, the government should for the interim allow employers to cut the salaries of their employees by between 10 and 30 percent over the next 12 months. Twelve months is a reasonable period assuming the Covid-19 crisis will drag for six months before subsiding and another six months for employers to rebuild their businesses.

The government can easily put in safety measures to protect the employers, for example, whatever deduction is done by the employers for this period remains an outstanding by the employer and to be paid back to the employees gradually after 12 months.

The government can also assist the employer by allowing the employer in the interim 12 months to pay a lesser proportion of the employer’s contribution towards the employee’s EPF. Again, whatever proportion or amount outstanding can be paid gradually after 12 months.

Also and in the alternative, the government can help out the M40 segment employer by providing ringgit-for-ringgit matching grant or loans to subsidise the portion of salaries unable to be paid by the employer. This is another way of preserving jobs.

These proposed measures could help in the preservation of jobs. To demand and insist that M40 segment employers continue to pay salaries in full is only inviting disaster. The government should face the fact many M40 segment employers businesses can fold up and with the loss of jobs and the government losing much-needed taxes from the M40 segment.

Stop paying scant regards. This is a nightmare unfolding. M40 segment employers matter. When jobs are lost, the government will have have a greater crisis on its hand. I say it again, a worse nightmare is now building up. Face up and do something before the implosion of loss of jobs (and a close of business) with the M40 segment employers also joining the B40 segment.

To continuously announce yet another aid for the B40 segment and the poor, and appearing on TV in yet another "Perutusan Khas", announcing another “lockdown” isn’t helping the M40 segment employers. Worse, it shows a government being indifferent and uncaring for the M40 tax-paying employers and believe me this is a disaster in the making.

I call on the government to start thinking of how to help the M40 segment employers. Face up and take notice that the M40 segment employers are helping the government by providing and preserving jobs. The government cannot afford for jobs to be lost.

Stop directing and reminding M40 segment employers that they must pay their employees their full salary. They really do not have RM2 million loose change lying about or a loot stashed up like many a politician or any luxury handbags that can be pawned or sold off cheap for cash to help run their business, pay staff their salaries and pay the government their taxes.

Ignore and be indifferent to the M40 employers and the M40 employers will remember the government come GE15.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

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