By Meena Laksana of fz.com
PETALING JAYA (Dec 31): In an attempt to defend the government and himself against mounting criticism for rising cost of living, the prime minister said unpopular decisions needed to be taken for the long-term benefit of the country.
He said sticking by the status quo is easy while making tough decisions is not but a responsible government has to make tough decisions for the future of the nation.
"People will say that too many costs are rising, and populist policies will seem attractive. But the government has to take action now," Datuk Seri Najib Razak said in his New Year’s message.
"Leadership is about looking to the long-term: about doing what is right, not what is popular. In 2009, we began a journey of economic and government transformation.
"As 2014 begins, we must continue to build the foundations for Malaysia’s continued success: a stronger economy, and a more unified nation.
"I am determined to do the right thing for this country and the people. Because by acting responsibly now, we will strengthen Malaysia’s economy in the long term – and the benefits will be felt much more widely," he added.
He said the nation must accept that changes need to be made to keep the country’s finances under control and it must be balanced so that the burden is spread.
Najib said by rationalising subsidies, the government will be able to strengthen the country’s fiscal position, allowing the nation to focus spending on development projects – including health and education - and move towards a balanced budget by 2020.
By taking the steps needed to make Malaysia’s economy stronger, he said the government is not only protecting our nation against financial crises, but also opening up new jobs and new opportunities.
"People will be more likely to invest in Malaysian companies, build Malaysian factories, and set up new businesses. This in turn will drive economic development, helping to improve people’s quality of life – and putting Malaysia in a much stronger position in the long run," said Najib.
Najib has come under fire for policies to be implemented next year that will see rising cost of living.
These include subsidy cuts for fuel and sugar, increase in electricity tariffs and the announcement of the Goods and Services Tax (GST) to be implemented in 2016.
Ordinary folk have taken their frustration to social media, venting on Najib’s official social media accounts, saying while the government beats the drum that the rakyat should tighten their belts, corruption and financial mismanagement are still rampant.
Help is available, albeit selective
Najib said the government "will do everything we can" to ensure the impact of such policies on the rakyat is minimised.
"Based on public feedback, where necessary we will fine-tune government programmes so that the effect on household incomes is not too great," he said.
"We will put in place mechanisms to cushion people from rises in the electricity tariff and toll fares. And Pemandu is coming up with new ideas to ease the cost of living pressures," he added.
He also said the government will try to ensure that rises are proportionate.
"For example, the rise in fuel and electricity prices will have an effect on people’s spending power. But, despite the increase, the government still subsidises petrol and electricity bills.
"As for the recent rises in property assessment rates in Kuala Lumpur, after listening to peoples’ concerns, the rates were reduced by 2%, and extra rebates were added for disabled property owners, retirees and owner-occupiers," he added.
He said the government will also support those in need of help to financially withstand during the tough economic times ahead.
"From last week, 7.9 million recipients in households earning under RM4,000 per month were eligible to apply for new BR1M payments. We are opening new 1Malaysia shops, to help with the cost of daily goods, and new 1Malaysia Kliniks to provide affordable healthcare.
"Altogether, next year the government will spend some RM42 billion on subsidies – almost as much as we spend on development," he added.
He also reiterated the government is cutting its costs, stating the 11 new measures to reduce public expenditure.
These measures include cutting the entertainment allowance of ministers and deputy ministers by 10% and that of senior government officers on the Jusa C Grade and above by between five and 10%.
The government will also reduce the use of event management firms and the handing out of door gifts or souvenirs during such events.
Apart from the allowances, Najib said yesterday that the government will also trim its consumption of food and drinks, as well as the use of buntings and banners during conferences, seminars, meeting, courses, workshops and other official functions.
Other measures include a reduction of 30% or between RM50 and RM100 in the toll facility offered to senior government officers.
The eligibility for domestic and international flight tickets for civil servants will also be amended, where those in the Jusa C Grade and below will only be eligible for economy class tickets on domestic flights.
Najib also announced yesterday that the electricity cost at all ministries, government departments and agencies will be reduced by 5%.
The government will also postpone any applications for renovation of government offices.
Opposition leaders and analysts have called bluff on the austerity measures, saying it is not significant cuts.