What the NEP meant and means

By P. Gunasegaram, TheStar 

We need more debate and less rhetoric in ironing out the real issues of affirmative action.


WITH all the brouhaha over Malay and non-Malay rights and the relentless rhetoric of race-based politics coming to the fore in the economic arena yet again, it is time to revisit the tenets of the original New Economic Policy (NEP) and separate fact from fiction.

Sadly, the major problem with the NEP is that the 30% equity target for Malays and other bumiputras became the very visible and de facto criterion for measurement of the very success of the NEP.

The other contentious part was quotas for all manner of things and preference given to bumiputra companies and individuals when it is related to procurements and contracts from the Government, often as a means to achieve that 30% target.

Both of these were administrative measures and targets and did not even form part of the policy aims of the NEP.

Very few people, if any, are likely to disagree that the broad twin aims of the NEP, formulated in the wake of the racial riots of 1969, were to eradicate poverty irrespective of race and to eliminate the identification of race with economic function.

The first aim, according to government figures, was very much achieved with hardcore poverty being virtually eradicated. And there have been major strides made in terms of Malays and bumiputras, and jobs with them making major inroads into all areas.

These are achievements of the NEP which no one can deny, although there are valid arguments and concerns such as whether the poverty line figure is a realistic one and whether there is too high representation of Malays in Government services even as they made inroads into the private sector.

While no one questions the twin aims of the NEP — everyone, including the Opposition, is in agreement — the problem is with the administrative measures that have been put in place.

These are being challenged by all sides: some sides want more and some less, some want them to be dismantled and others want them to not only be continued but reinforced.

So, let’s agree on the aims – and move on from there.

Thus, it will not be seditious if someone questions the 30% bumiputra equity target or says the measurement criteria are seriously flawed.

If someone said quotas should be reconsidered given the progress that Malays have made in some areas, that should not be interpreted as questioning Malay rights. Under the Constitution, the Government has the right to undertake affirmative action provided it is justified and it has the right not to.

The NEP (technically, the NEP has expired but the present policy still relies on the original NEP) and its future form will benefit substantially from the right kind of debate about it without emotions clouding the issues.

But there are some bodies and people who are bent on bringing in emotions precisely because it will cloud the issues. They must not be allowed to have their way.

Let’s take the 30% equity target for instance. It cannot be taken as the sole or even the most important part of NEP achievement because there are other things which are far more important – poverty eradication and racial balance in employment to name just two.

There is therefore nothing wrong in asking that this target be reviewed so that we can have better measurement of Malay and bumiputra participation in the economy and to avoid all the perils of patronage that come with this.

The same applies to quotas and bumiputra discounts for high-end property.

It is because the NEP has done so much in narrowing the gap between the races that there is a need to review some of its administrative targets to ensure that the wrong people do not benefit from it.

Bumiputras who have already made it don’t need quotas and affirmative action anymore. But others might.

But we must expect that some of those who will lose their so-called privileges will fight a rearguard action to preserve them, for that’s a way to quick riches when abused. These are the people who will benefit most by obscuring the real issues under a cloud of emotional rhetoric.

The time has come for all Malaysians to see beyond these and do what is right for everyone. Help everyone who is needy and if any particular race is more needy than another, it will automatically be helped more too.

Move to a needs-based system and you eliminate racial posturing and fighting just like that.