Former deputy prime minister and adviser to the opposition Parti Keadilan Rakyat Anwar Ibrahim said the pay increment for civil servants announced today indicated the government was preparing for an early election.

"Clearly the whole intention and purpose of announcing it in this period shows that it is around the corner," Anwar told reporters, flagging an end-2007 date for the poll.

"It will ease a lot of problems faced by the common folks, particularly with the rising petrol prices and price hikes impacting negatively the welfare of the people.

"That means that election is very close," he said, after attending the launching of Islamist party PAS' new headquarters in Kuala Lumpur today.

Anwar is barred from formal politics until April 2008 over a corruption conviction, and analysts have said a poll could be called as early as the end of 2007 to exclude him.

Mohammad Agus Yusoff, head of political science at the Universiti Kebangsaan Malaysia, said the salary hike was long overdue but added changes would not be enough of a sweetener ahead of an election.

"The cost of living has gone up. It's a logical thing for the government to do ... but they cannot rely on these sorts of goodies that they give," said Mohammad Agus.

Good economic performance

Earlier today, Prime Minister Abdullah Ahmad Badawi announced the government will spend RM4 billion this year on pay rises for some one million civil servants.

Under the hikes, approved earlier this month, 1.0 million civil servants will see rises of between 7.5 to 35 percent, while the police and armed forces will receive an additional 20 percent on their increment, Abdullah said.

They will also get a 100 percent increase in cost of living allowances, with all the rises effective from July 1 this year, he said.

"Overall, the pay hike is worth RM3.4 billion for this year, or an additional expenditure of RM6.8 billion annually," Abdullah told a gathering of over 2,000 civil servants in Putrajaya, the adminstrative capital.

"The increase in the cost of living involves an additional expenditure of RM600 million for this year or RM1.2 billion per year," he said, as the workers cheered and applauded the news.

Deputy Prime Minister Najib Abdul Razak at the function told reporters the hikes were not calculated to raise spirits ahead of an election.

Malaysia must hold a general election by early 2009, but a poll is expected by the end of this year or in early 2008.

Abdullah, who earlier this month said civil servants deserved the pay hikes, hailed Malaysia's economic performance as a reason for the change.