Read a joke, “only human has to pay to live on this earth”. How true! Human created it, along with private ownership. So, how much a person needs to live in Malaysia? Malaysia government says, minimum RM1,500 per month. That’s our minimum wage since May 2022, reviewed every 2 years by The National Wage Consultative Council Act 2011. After deduction, take home pay might be RM1,300, for an employed person. He or she must spent on food (17.3%) + 5.2% inflation, about 23% of RM1,300 is RM300 per month which is not practical in urban area. Even if I eat just for survival, minimum required is RM15 per day or 35% (RM450) from the income. For housing, water and electricity, with 1.2% inflation, need RM320. Again, with this amount, you can only rent a small room, about RM250. We need at least RM700-RM1000 per month to rent a 2 bedroom house/flat. Meanwhile with 3.9% inflation for transport, RM261 per month is the consumption, according to government data. Again, doubtful if this is the reality, considering for most low income jobs, work from home option is not possible and does not reflect bank loan repayment for vehicle (car or motorcycle). It’s not just petrol, toll and parking. At least RM500 needed monthly for transport. Government’s RM50 MRT My50 is very useful. I was using it for several months but still need to spend on petrol to travel from home to MRT station and car parking, with total cost about RM160 a month. How much more left from RM1,500 (450+700+500)? Nothing, on deficit by RM550!
If one falls sick or need new clothes or reload phone or repair leaking pipe or other family emergency and natural disaster such as flooding, has to rely on family members/parents or take loan. More debts with high interests! Can’t even provide for oneself, how to support another e.g. elderly mother, children, with mere RM1,500? It results in more people taking up second job.
Strong hearsay about B40 has become B60 (income classification). Many households are pushed from M40 to B40.
[In 2019, the average size of Malaysian households was 3.9 persons].
The gap between rich and poor is widening and national budget should redistribute resource effectively to enable the lower income group, live a decent life with adequate access to basic needs, quality food, savings for emergency and old age. Equally important, balanced lifestyle. Healthier workforce means higher productivity and GDP (the total value of everything – goods and services – produced in our economy).
How will the Budget help the vulnerable?
Obviously, people living in financial difficulties, want to know how the government budget will reduce their financial burden, job creation and how the inflation will be controlled. [The higher prices of goods and services, the more we need to fork out money while wages remains the same]. About creating job, not sure if that is the role of Government or private sectors. Since government is also investing in Business (GLCs), assuming they are responsible to create job and conducive environment for some 1.15 million SMEs or 97.2% of total businesses in the country (https://www.smecorp.gov.my).
The government reported (https://www.theedgemarkets.com) that the estimated income for 2023 is RM285.22 billion. RM372.3 billion is allocated under Budget 2023. Expenditure is more than income! RM272.3 billion for operating expenditure, RM95 billion for development expenditure. Budget 2023 provides RM55 billion for subsidies, social assistance and incentives. Apparently allocation for subsidy is reduced compared to previous year, according to MP Subang, Wong Chan.
- Electricity bill subsidy of up to RM40 will be provided for households with income of RM1,169 and below, compared to the present RM980 and below.
- RM2,500 for Bantuan Keluarga Malaysia (BKM)— one-off assistance for households with five children or more, with income of less than RM2,500 per month.
- BKM allocation is RM7.8 billion, to benefit 8.7 million recipients (about RM900 per household)
- One-off RM500 cash aid for mothers from Bantuan Keluarga Malaysia households who give birth in 2023
- Government to bear cost for B40 youths to get taxi, bus, e-hailing licenses via MyPSV programme
- Graduates with first-class bachelor’s degrees exempted from repaying PTPTN loans – good move but to what extend it benefits the low income group assuming that the first class bachelor’s are mostly people with better opportunity and wealth.
- RM256 million in monsoon season assistance to small rubber farmers, to benefit 320,000 small farmers (RM800 per farmer)
- Supplementary Food Plan rate raised from RM2.50 to RM3 in Peninsula, and from RM3 to RM4 in Sabah, Sarawak and Labuan – good effort to feed the rural and poor primary school children.
- ‘Bantuan Awal Persekolahan’ aid will be extended to all pupils, irrespective of their parents’ income level (cash assistance RM150 one-off)
- Govt to provide RM700 as special financial assistance to 1.3 million civil servants grade 56 and below, and RM350 to 1 million govt pensioners next year; these provisions will amount to RM1.3 billion
Development project that would benefit the public:
- RM1.8 billion allocation for building of new hospitals, clinics and facilities, as well as for procurement of medical equipment. Let’s estimate RM150 million per hospital with 130 beds. Will the nation have another 10+ government hospitals within next 5 years (currently, 154 government hospitals and 250 private hospitals)?
- RM700 million allocated for flood mitigation plans – not sure if this is adequate and how soon and effective the mitigations will be. Recently, villagers from one location at Bt. 9 Hulu Langat, affected by EKVE project, said their village flooded 5 times this year. Damage to their property – car, house, household things, road and bridge. They spent RM15,000 to build a bridge with the funds collected among themselves. Not much help from the government and politicians. Only promises. There are many other locations in the 13 states, with same issues.
I am not an economist but as a lay person, the benefits are minimal. The one-off cash assistance, RM800-RM900, for basic needs or to pay any long outstanding debt is always good. If flood mitigation is done timely, then it will be another relief for many households who are sick to worry whenever the sky is cloudy. For low income families especially those with young children, increased quality of the supplementary food provided in schools is a good news. Increased number of hospital and reduced waiting period for critical illness treatment are important. So, I choose a government 5 years once only for this?
Letchimi Devi
(9 Oct 2022)