Government To Focus On Increasing Income And Reducing Disparity, Says Najib

Datuk Seri Najib Tun RazakPUTRAJAYA, Dec 19 (Bernama) -- The government will focus on the twin aspects of increasing income based on productivity and reducing income disparity in the quest towards driving the nation to developed status.

Prime Minister Datuk Seri Najib Tun Razak said Malaysia's economy needs to be based on the majority of the people being able to feel that their income is increasing in tandem with improving productivity.

"Only with rising income, does the term, 'developed nation', have meaning for the people.

"If the income disparity between the poor and rich is wide, it will create a feeling of dissatisfaction among the people," he added.

He said this in his speech at the Budget 2015 and Treasury Retirement Night 2014 event, at the Ministry of Finance (MOF) here Friday night.

Najib, who is also the Finance Minister, said based on the World Bank Report released two days ago, as a result of the policies introduced by the government, Malaysia's Gini coefficient had improved from previously.

"Despite this, we have yet to reach the level of an egalitarian or more equitable distribution of income, such as that in the Organisation for Economic Cooperation and Development (OECD) countries. So, there is a lot to be done," he added.

He also said that in the uncertain global economy, Malaysia needs to have a strong foundation that is capable of facing and recovering from any form of sentiment.

According to Najib, if the country's economic fundamentals are weak, any economic crisis will linger, such as what is happening in Europe and no one is exempted from it (the crisis), even if it is a developed nation.

"Among the aspects that determine the country's fundamentals is revenue that is strong and sustained. As such, the decision to implement the Goods and Services Tax (GST) in the current economic climate, seems to be one that is very correct.

"I say, very correct, as when the country's revenue is affected, the GST will help support it with a very significant improvement.

"I will not predict, how much of an increase. But we pray that the GST implementation will have a better impact on the country's improving revenue. When revenue improves, we can help the people," he said.

Najib also said he was proud of the staff of the MOF, who had shown a high commitment towards the preparation of the Budget 2015 which had been received positively by the people.

Meanwhile, the Treasury Secretary General Tan Sri Mohd Irwan Serigar Abdullah in his speech said with the downtrend in the global oil prices and poor performance of the money market, Malaysia's economy is expected to remain strong with a targeted Gross Domestic Product (GDP) of more than 5.7 per cent for this year.

He said the registration of companies for the GST as of Thursday had reached 229,700 with more than 4,000 registering daily.

"It is hoped that the number of registrations will exceed the new target of 240,000 by year-end," he added.

A total of 21 MOF staff of various grades and divisions who retired between June to December 2014 were feted at the event tonight.

Wage, property inequality in Malaysia on the rise, study shows

Wealth is concentrating in the already affluent as inequality in property and earnings in Malaysia are rising, a joint study by Universiti Malaya (UM) and the Khazanah Research Institute has found.

The study covered the private and public sector, and showed that data from the official Household Income Survey (HIS) yielded opposite findings when compared with data on private sector salaries, public sector employment and the National Property Information Centre (Napic).

UM's Dr Lee Hwok Aun and Khazanah's Dr Muhammed Abdul Khalid found that while the HIS reported a decline in inequality of gross household income, the other data sources showed that inequality in terms of personal earnings and house ownership was increasing.

"We find evidence that inequality is growing in earnings in both the private and public sectors and increasingly concentrated at the topmost strata," Muhammed told a seminar titled "Has inequality in Malaysia really gone down?" in UM today.

"In terms of wealth ownership, there is also rising inequality in property ownership."

According to data from the Employees Provident Fund (EPF), the largest retirement fund in Malaysia, the Gini Coefficient of the savings accounts had risen from 0.643 in 2004 to 0.661 in 2013, the researchers said.

(The Gini Coefficient Index measures the distribution of income in a certain country. According to the HIS, the Gini Coefficient of Malaysia's gross household income in 2012 was 0.43.)

‎"The savings of the bottom half of EPF account holders has fallen from 2004 to 2013, while there is a slight increase in concentration at the top 1%," said Dr Lee, a senior lecturer with UM's Department of Developmental Studies.

The salaries of workers aged 26-35 had also grown at slower rates from 2004 to 2013, and lagged behind the earnings of those above 40 years of age, they said.

Meanwhile, in the public sector,‎ the rank of managers and professionals have expanded disproportionately‎ faster from 1999 to 2012, according to their compilation from the Employment List of Ministries and Departments in the Estimated Federal Budget.

"There is a concentration in the uppermost positions, which is similar to the findings from the EPF. The top management enjoys higher income," said Lee.

In 1999, the top management comprised 0.09‎% of the staff, while the management and professionals made up 14.07% of the staff.

But in 2012, 0.17% of the staff were top management and 29.80% were of the management and professionals.

"The disparity between the top 10% and bottom% may have increased," said Lee.

The researchers said the Gini Coefficient of residential properties sold a year had also increased from 0.51 in 1996 to 0.53 in 2011, according to their calculations based on data from Napic.

"‎The value of property purchased by high-end buyers has grown more rapidly than property purchased by low-end buyers throughout the years," said Muhammed.

The share of total property value by the bottom 20%‎ from 2006 to 2011 has remained stagnant at 5%, while the top 10% have enjoyed a growth from 35% to 40% of total shares during the same period, according to the data.

‎The researchers also said that passenger vehicle sales data show increasing proportions of luxury cars from 2001 to 2011.

"There is a rising share ‎of vehicles sold at the high end and bottom end, and rapid growth in luxury brands and compact cars," said Lee.

‎Data from private unit trust funds such as Amanah Saham Berhad showed that the majority own very little and have seen their shares declining from 2007 to 2012, said Muhammed.

The shares of the bottom 50% of ASB share‎holders has dropped from 3% to 2%, while the 80th to 90th percentile have seen an increase from 76% to 77% share ownership from 2007 to 2012, according to the researchers.

But the researchers noted that according to the HIS‎, household income inequality has been on a downward trend since 2004.

"The HIS states that Malaysia's Gini Coefficient of gross household income shrank 0.84%‎ per year from 2004 to 2012, while in the 2000s, the bottom 40% enjoyed relatively higher income growth," said Lee.

The researchers suggested that the disparity‎ between the HIS and their own study may be due to the fact that the HIS did not take into account the earnings of each individual in a household.

"The HIS reports the aggregate gross household income. There is no distinction between earned income and gross income," said Lee.

"Gross household income inequality may be declining while personal earnings inequality rises due to transfers and multiple income earners in a household." – November 5, 2014.

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RM2,500 salary enough for those who manage their finances well – Bernama

A starting salary of RM2,500 for graduates who have just entered the employment world will suffice as long as they manage their finances well and live within their means.

Economist and financial management experts say this average starting salary can be considered reasonable especially when looking at the fact that these greenhorns have no skills or experience and that the employer has to take the risk of employing them.

The head of the education division of the Credit Counseling and Debt Management Agency (AKPK), Mohd Adnan Anan Abdullah says on how much graduates should start off is up to the individual but for the spendthrift even a bit fat pay cheque will not suffice.

"Whether what one earns is enough of otherwise is all dependent on the individual's profile. Say in Kuala Lumpur, if one eats out every day it could cost up RM30 per day, and the spending will be greater if one has habits like smoking".

Apart from that, those who have just started work should not rush into buying luxuries, like a car. They should stabilise their financial position beforehand.

Newcomers are certainly disappointed

"Owning a car at a very young age is definitely 'cool' but one should not forget of the additional ownership costs involved – fuel, toll, parking charges, maintenance and insurance coverage when lumped up could prove to be hefty", he said.

A study on job seekers going through the job portal Jobstreet found degree holders felt that the average RM2,500 being insufficient with 77% of the 2,062 respondents could hardly save after spending on the basic necessities.

About 60% of the respondents expected a starting salary of RM3,500, while 30% of them asked for RM6,500. On the employers side, 66 of them said they were ready to pay between RM2,500 and RM2,800 depending on the qualification.

However, Mohd Adnan refuted claims that a salary of RM2,500 is insufficient to keep aside some amount for savings and saving 10% of one's monthly income is part of good financial management.

"Saving is important, but calls for tough financial discipline and perseverance, and can be done through unit trusts or separate bank accounts. As long as there is balance in the bank account one will be tempted to spend, thus savings must be something that one is forced to do", he says.

Graduates have to see the bigger picture

The Executive Director of the Federation of Malaysian Employers, Shamsuddin Bardan points out the aforementioned starting salary could be considered as reasonable for graduates who have no experience and the fact that employers have to spend to teach them on the trade.

"They have to realise that the employment openings are limited and if they are too demanding on the salary they may end up being unemployed.

"So take a positive view and see your first job as the opportunity to seek knowledge, and after having garnered some experience they could 'test the market' at other places. There is no obligation for one to remain loyal to an employer".

Shamsuddin adds that if they excel, along with additional qualities like good communication skills, don't be surprised the employers themselves give a pay rise within a short time.

Employers are well aware that they could easily lose good employees if they are not rewarded accordingly.

Take it as a practical training

An economic lecturer with Universiti Malaysia Sarawak (Unimas) Professor Dr Shazali Abu Mansor shared similar views with Shamsuddin.

Prof Shazali says graduates should consider themselves as still undergoing practical training while at their first job.

"The key here is patience. If during your practical training you could take a bus, why not do the same now? Don't think that as soon as you start work you could just forget how you lived as a student.

"To help them tide over the tight financial situation, those who have provided them with study loans like the PTPTN should defer the repayment of the loans to two years after starting work as by then salary increments would have taken place," Shazali said.

The committee member for the economic and management cluster of the National Professor Council, Professor Dr Samsinar Md Sidin says the younger employees, especially those who reside in towns, should spend wisely.

"At times it is better to rent a room near the workplace, though it may be expensive it is better than traveling from far away, as this also helps to avoid the waste of time and energy", he says.

The lecturer at the economic and management faculty of Universiti Putra Malaysia (UPM) added that parents could help them financially at the initial stage.

"Some of those who had just graduated also do part time work, including through online means, however they have to ensure their main occupation is not affected. Don't waste any opportunity", he says. – Bernama, October 7, 2014.

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Household income RM5,900 a month? Why it’s a lie…

Malaysian households earn RM5,900 a month? The problem about telling lies is that with time, the liar believes his own.

By Steven Sim

People say politicians often tell lies. But really more often than not, they give us statistics. What is the difference?

I’ll let Mark Twain tell you: “There are three kinds of lies; lies, damned lies and statistics”.

The latest statistics our government proudly brandished at us was the report that household incomes in Malaysia had surpassed RM5,900 a month.

This was presented by Abdul Wahid Omar, the former boss of Maybank roped into the Cabinet as “Economy Minister”.

Intuitively, most Malaysians know it’s a farce. Why?

Because many families we know, maybe including our own, earn much less than RM5,900 a month.

Because even the government proudly claimed that its cash transfer programme BR1M benefited 80% of Malaysian households. The only condition for BR1M is that a recipient household must earn less than RM3,000 a month.

Because as recent as September 2013, the government said that 82.5% of young Malaysians below the age of 30 earned below RM3,000 a month. These constitute more than one-third of workers in Malaysia.

Because according to the 2012 Household Income and Basic Amenities Survey (HIS/BA 2012), the bottom 40% of Malaysian households only earned about RM1,800 per month.

Additionally, while the HIS/BA 2012 already noted that the average Malaysian household earned RM5,000 a month, 50% of Malaysian households actually earned less than RM3,626 monthly.

How did this happen? Statistics, the art of telling official “lies”.

(Caveat: I love statistics because if used responsibly, they provide useful insights into reality.)

The Economy Minister used the latest HIS/BA 2014 which has yet to be published by the Department of Statistics on its website. Hence, I will use the HIS/BA 2012 to illustrate how he has cleverly used statistics to paint a rosy picture of our earnings.

Abdul Wahid used mean household income to demonstrate that we are already earning RM5,900 a month.

In the HIS/BA 2012, as mentioned above, the mean household income was already RM5,000 a month. This was basically arrived at by averaging the total income of all households with the total number of households.

As we all know, arriving at an average works well if the data set is symmetrical, i.e. if everyone has roughly the same salary. Otherwise, one or two greater values in the set will significantly skew the average from the other values.

We may just add a local twist to the famous anecdote: Bill Gates entering a workmen’s bar, immediately turns everyone into a millionaire. Similarly a minister like Abdul Wahid comes in to take an income survey and presents the mean income of the bar patrons.

On the other hand, the HIS/BA 2012 also reported that the median household income in Malaysia was only RM3,626.

Median gives a better picture of an asymmetrical set of data, that is, a set with values which differ greatly from one another. It divides the set equally into two parts above and below the median value.

Thus according to the HIS/BA 2012, 50% of Malaysian households actually earned less than RM3,626 monthly although the average income was RM5,000 a month.

Both are valid statistical outputs, so what is the problem?

If you ask me, the problem with such “dishonesty” is not so much about the government lying to us but rather the government lying to itself.

By patting its own back on the so-called achievements, the government has created a false sense of its own success, thus running the risk of ignoring the real situation and the work still needed to be done.

During my first parliamentary sitting in 2013, the same Economy Minister proudly told the House that because our country’s unemployment rate was below 4%, according to economist John Maynard Keynes, we can be deemed as having full employment.

Since then, I have been pointing out that such self-congratulatory perspectives continue to blind the government towards the real condition of employment in this country, ranging from high unemployment among young Malaysians including graduates to the issue of underemployment, from unfair industrial practices to gender discrimination in the job market, from our over-dependence on low-skilled migrant labour to brain drain.

Similarly, when someone with the stature of the Economy Minister says that we are already earning RM5,900 a month, the government risks overlooking the actual problems of low wages, high cost of living, high debts among Malaysians and income inequality.

Even with all the reports showing economic growth, we have failed in the last 20 years to achieve any significant improvement to close the gap on inequality.

According to Second Finance Minister Ahmad Husni, Malaysia’s Gini Coefficient Index, which measures inequality (0 means perfect equality, 1 means perfect inequality), was 0.431 in 2012, one of the highest in the region, compared to countries such as Thailand 0.4 and Indonesia 0.37.

Thus, the problem about telling lies is not that others will be convinced, rather its that the one telling the lies eventually believes it himself.

Steven Sim is the Member of Parliament for Bukit Mertajam

PSM: Govt not serious about minimum wage

The government is not serious in implementing the minimum wage ruling and no action will be taken against errant employers, said Socialist Party Malaysia (PSM) and Jerit.

KUALA LUMPUR: Socialist Party Malaysia (PSM) and Jerit, a coalition fighting for oppressed people, said the government is not serious in enforcing the minimum wage order and errant employers will not be brought to book.

PSM secretary-general S.Arutchelvam said several letters had been sent to the Human Resources Minister for a discussion on how the ruling would be implemented but until today there had been no response.

Arutchelvam said if the government was serious in enforcing the order they should have carried out an awareness campaign before the end of this year to inform employers because many were not aware of the ruling.

The Minimum Wage Order 2012 came into force on Jan 1, this year, for employers who have more than six workers but full enforcement will only be carried out from January next year.

“I am confident the government will play a ‘wayang kulit’ not to seriously enforce the ruling.

“The implementation of minimum wage order early this year is merely to entice labour votes for Barisan Nasional in the last general election,” he said at the PSM office today.

According to a written reply made by Human Resource Minister during parliament session to Othman Abdul (BN-Pendang) on Oct 3, 2013, the minister stated that there would be no more postponement of enforcing the ruling and all employers must comply beginning January next year.

In the same reply, the minister also pointed out that the postponement was given as an interim for the employers to restructure the wage policy of their companies.

If the employers failed to enforce the ruling, the ministry will penalise the employers according to National Wage Facilitation Act 2011 and among the action taken are:

First offence – a fine not more than RM10,000 for each worker;

General penalty – a fine not more than RM10,000 for non-specified offence;

Continuous offence – RM1,000 fine for each day as per conviction; and

Repeated offence – RM20,000 fine or imprisonment not more than five years.

Prosecution against employers will only be taken after all the steps above are taken.

Kerajaan tak serius laksana gaji minima

Jika kerajaan mahu syarikat ini melaksanakan skim gaji baru, bayaran ini harus ditingkatkan.

KUALA LUMPUR: Kerajaan dilihat tidak serius melaksanakan penyelarasan polisi gaji minima walaupun pengumuman mengenainya dibuat sejak awal tahun ini.

Antara syarikat yang belum melaksanakan gaji minima adalah syarikat kontrak yang membekalkan perkhidmatan keselamatan, pemberihan dan sebagainya kepada kerajaan.

Alasan yang diberi oleh syarikat kontrak ini adalah bahawa kontrak mereka belum diubahsuai oleh kementerian berkenaan untuk membolehkan mereka membayar gaji yang lebih kepada pekerja,

“Syarikat kontrak ini mengadu sebut harga mereka semasa memohon kontrak adalah berasaskan skim gaji terdahulu.

“Jika kerajaan mahu syarikat ini melaksanakan skim gaji baru, bayaran ini harus ditingkatkan.

“Sepatutnya bajet yang diluluskan pada November 2012 untuk tahun 2013 harus mengambil kira keperluan meningkatkan bayaran kepada semua kontraktor perkhidmatan supaya membolehkan mereka mematuhi skim gaji mulai Januari 2013,” dakwa Koordinator Jaringan Rakyat Tertindas (Jerit) M Sivaranjani.

Beliau sebelum itu bersama kira-kira 50 penyokong Jerit, Parti Sosialis Malaysia (PSM), dan beberapa badan bukan kerajaan lain (NGO) melakukan demonstrasi dihadapan pintu masuk utama bangunan Parlimen pagi tadi.

Perhimpunan aman itu mengemukakan empat tuntutan supaya kerajaan lebih bertanggungjawab terhadap pelaksanaan gaji minima dengan adil termasuk terhadap pekerja asing.

Selain itu, 600,000 syarikat kecil dan sederhana (SME) yang melibatkan 70% pekerja tempatan harus dibantu untuk melaksanakan gaji minima mulai Januari 2014.

Kerajaan juga perlu menghulurkan bantuan kepada syarikat SME dalam kadar pengecualian cukai syarikat untuk satu tempoh tertentu, mengambil alih pembayaran syer majikan kepada Kumpulan Wang Simpanan Pekerja (KWSP) untuk satu tempoh masa tertentu, serta membekalkan kuasa elektrik dengan kadar yg lebih murah.

“Kami mahu kerajaan bersikap serius dalam hal ini dan berharap ada peruntukan perbelanjaan yang perlu untuk membolehkan SME melaksanakan gaji minima dalam Belanjawan 2014.

“Kami ingin mengingatkan semua pihak bahawa gaji sebanyak RM900 sebulan bukan satu jumlah yg lumayan.

“Tidak mencukupi untuk sebuah keluarga menampung segala perbelanjaan dengan pendapatan RM1800 sebulan (jika suami dan isteri bekerja).

“Tetapi apabila gaji minima yang begitu rendah pun tidak dapat dilaksanakan diseluruh negara, timbul keraguan pekerja terhadap keseriusan kerajaan menangani isu ini,” katanya.

Memorandum tuntutan itu kemudiannya diserahkan kepada Menteri Sumber Manusia Datuk Richard Riot Jaem di Parlimen.

Gaji minima: PSM bidas kenyataan bercanggah Riot

Kini sudah 10 bulan dan nampaknya semakin hari semakin jelas bahawa Akta Gaji Minima gagal dilaksanakan, kata S Arutchelvan.

PETALING JAYA: Parti Sosialis Malaysia (PSM) membidas Menteri Sumber Manusia Datuk Richard Riot yang mengeluarkan kenyataan bercanggah berhubung isu pelaksanaan Akta Gaji Minima.

“Kini sudah 10 bulan dan nampaknya semakin hari semakin jelas bahawa Akta Gaji Minima gagal dilaksanakan,” kata setiausaha agung S Arutchelvan dalam satu kenyataan hari ini.

Menurutnya, gaji minima RM900 di Semenanjung Malaysia dan RM800 di Sabah dan Sarawak yang diumumkan pada 1 Januari 2013 masih belum dilaksanakan dengan sepenuhnya untuk para pekerja di negara ini.

Beliau berkata, pihaknya menerima aduan terhadap lebih 200 majikan yang tidak melaksanakan Akta Gaji Minima.

Tegas beliau, “mereka juga melakukan pelbagai manipulasi seperti memasukkan elaun dalam gaji minima, tambah hari kerja, menghentikan elaun pengangkutan, menghentikan bayaran lebih masa dan banyak lagi untuk mengelak daripada pelaksanaan gaji minima.

“Apa yang mendukacitakan kami bukannya manipulasi majikan tetapi peranan Kementerian Sumber Manusia (KSM),” katanya.

Menurutnya, Riot dalam akhbar The Star 24 September lalu berkata tiada sebarang aduan tentang gaji minima diterima oleh KSM sejak pelaksanaan Akta tersebut.

Ujar Arutchelvan, “ini adalah satu pembohongan besar di mana PSM telah menyerahkan lebih 100 aduan terhadap majikan yang melanggar Polisi Gaji Minima. Lebih 100 aduan ini melibatkan ribuan pekerja tempatan dan luar negeri.

Riot juga dipetik Bernama pada 27 Ogos lalu mengatakan bahawa pihaknya tidak akan memberi sebarang kelonggaran kepada mana-mana syarikat mulai Ogos 2013 daripada pelaksanaan gaji minima.

“Tetapi Menteri berkenaan pada 1 Oktober lalu mengatakan bahawa kesemua 600,000 Syarikat Kecil dan Sederhana (SMEs) telah diberi kelonggaran daripada melaksanakannya sehingga Disember 2013.

“Kenyataan-kenyataan dari KSM memberi gambaran bahawa kerajaan tidak konsisten dan tidak serius dalam pelaksanaan Polisi Gaji Minima malah seolah-olah bersekongkol dengan para majikan untuk tidak melaksanakan Akta Gaji Minima,” jelas Arutchelvan.

Beliau berkata PSM kecewa kerana nasihat dan cadangan pihaknya untuk membantu SMEs tidak diendahkan.

“Ini kerana selagi tiada satu pendekatan serius untuk menyelesaikan masalah SMEs, maka selagi itulah tidak akan ada pelaksanaan gaji minima secara keseluruhan bagi pekerja di Malaysia. Oleh itu kami mencadangkan:

• Memberi subsidi kepada syarikat yang hanya membayar gaji minima. Sebelum ini banyak kali kerajaan bail-out (menyelamatkan) majikan besar semasa krisis ekonomi. Mengapa SME tidak boleh dibantu untuk dibayar gaji minima padahal jika pekerja mendapat gaji munasabah, maka mereka akan membelanjakan wang kembali ke dalam sistem ekonomi negara.
• Mengecualikan firma kecil daripada bayaran cukai untuk satu tempoh;
• Menawarkan letrik dengan kadar yang lebih rendah untuk satu tempoh masa bagi syarikat SMEs.

Minimum wage hotlines launched

PSM says the government has gone back on its word by giving leeway to 600 firms.

KUALA LUMPUR: Parti Sosialis Malaysia (PSM) and the workers’ rights organisation Jerit have set up a system to monitor companies’ compliance with the Minimum Wage Act.

This followed last week’s announcement by the Human Resources Ministry that it had permitted 600 companies to restructure wages so that what were previously categorised as allowances were now incorporated into the basic pay.

PSM secretary general S Arutchelvan today described that decision as tantamount to the government going back on its word.

He told a press conference that the monitoring system would be managed by PSM and Jerit. At its heart is a network of hotline numbers that disgruntled workers can call to lodge complaints, which will then be forwarded to the Human Resources Ministry. There are also complaint forms that workers can fill in without fear of their identities being revealed.

Arutchelvan said PSM and Jerit were distributing the complaint forms to workers in gazetted industrial areas.

He also announced that the two organisations would hold their Minimum Wage Awareness Week from Jan 20 to Jan 26 at various industrial zones nationwide, where they will distribute cards explaining workers’ rights under the minimum wage policy.

Jerit coordinator M Sivaranjani said more than 300 workers had approached Jerit and PSM since December with inquiries about minimum wage.

The Minimum Wage Act was gazetted in July 2012 and becomes effective this month. It fixes minimum wage at RM900 in Peninsular Malaysia and RM800 in Sabah and Sarawak.

Arutchelvan demanded that the government reveal the names of the 600 companies that have been exempted.

He suggested that the government provide subsidy assistance to companies claiming to have difficulties in giving minimum wage instead of allowing them to postpone its implementation.

He also suggested that the Human Resource Ministry announce a hotline number for workers to lodge complaints against companies breaking the minimum wage law.

Minimum wage won't bankrupt SMIs, Khairy told

RM1182 monthly per capita household income

The average per capita income for Malaysia derived from the Household Income Survey 2009 came up to RM1168 per month, only a slight increase from the figure of RM1028 in 2007.


For Sarawak, the figure was RM974 per month in 2009 compared to RM899 in 2007. That would translate to RM11688 for the whole of 2009. (Compare that to Sarawak’s GDP per person amounting to RM30318 in 2009, based on Department of Statistics reports, making it the ‘richest’ state in the country in terms of the production of goods and services.)

In 2009, the average per capita monthly income for Malaysia was as follows (Sarawak figures in brackets):
Bottom 40 per cent of households – RM404 (RM312)
Middle 40 per cent of households – RM1056 (RM822)
Top 20 per cent of households – RM3124 (RM2600)

These figures are from a written response to a question raised in Parliament on 12 June 2012 by Chong Chieng Jen, the MP for Kuching.

The figures for the top bracket are probably distorted by the astonishing amounts ‘earned’ by the corrupt and their cronies, which are in all likelihood under-reported. Then there are the huge leakages out of the country.

Minimum wage for all workers

Contract workers, cleaners and gardeners are also eligible to receive minimum wage, clarifies the Human Resources Ministry.

PUTRAJAYA: All workers, including contract workers, cleaners and gardeners are eligible to receive minimum wage.

Human Resources Ministry’s human resources policy division secretary Kua Abun clarified this during a meeting with members from a NGO, Oppressed People’s Network (Jerit), and Parti Sosialis Malaysia (PSM).

Earlier this morning Jerit and PSM held a demonstration involving 30 people. A closed door discussion with the ministry was then held for about an hour.

On May 1, Prime Minister Najib Tun Razak announced that minimum wage was fixed at RM900 in Peninsular Malaysia and RM800 in Sabah and Sarawak.

It would be gazetted on July 1 and would come into effect in January 2013.

Speaking to the press after the meeting, Jerit coordinator M Sivaranjani said: “The information department in the Human Resources Ministry had erred by stating that cleaners and contract workers are not eligible for minimum wage.”

“Only domestic maids and those who are self employed are not eligible for minimum wage,” she added.

She said that only companies which had less than five employees were allowed to implement the minimum wage system in July 2013.

“The list of those companies with less than five staff will be released next year,” she added.

Sivaranjani also said that the government would assist companies that were unable to implement minimum wage.

In addition to that, she said that the ministry would be reviewing minimum wage every two years.

Sivaranjani said the Malaysian Employers Federation (MEF) was also guilty of issuing a circular which claimed that allowance were included in the minimum wage.

“The circular is invalid. Discussion between MEF and the Human Resources Ministry is ongoing.

“If there are employers implementing what is stated in the circular, complaints can be lodged against them at the labour department,” she added.

The minimum wages - Senator S. Ramakrishnan

Senator S. Ramakrishnan, 3/5/2012

The much delayed minimum wages was finally announced by PM the main stream media still hotly debating the consequences of Bersih 3.0. Minimum wages for workers in Peninsular Malaysia has been set at RM900 a month while for Sarawak, Sabah and Labuan is RM800 per month. The minimum wage would cover workers in all sectors of the economy, except for the domestic help service or maid, gardener and similar employment categories. The minimum wage will take effect six months from the date the minimum wage order is gazette. Seem to be a half hearted plan that may not take off. Selangor state implemented minimum wage of RM1500 for state and state GLC employees while Penang government RM1100.

The announcement comes as another sweetener for workers before the 13th general election. It’s an election goody and a knee jerk reaction in response to the workers protest on 3rd November 2011 against the amendment to employment act 1955. The PM wants to win over workers to support BN in the coming general election. The debate on the acceptable level of minimum wages will go on for some time to come.

PM implemented the 10th Malaysia plan in 2009 to become a high income nation by 2020. It took 3 years to announce a minimum wages plan. A minimum wage of RM900 will only attract more foreign workers. Malaysian workers cannot survive on such a wages. Foreign workers will displace the unskilled Malaysian workers in low paying jobs keeping Malaysian workers earning below poverty level. Wages alone is no longer a major determinant of competitiveness but in Malaysia it is deliberately kept low through large and unfettered recruitment of foreign workers by employers and crony agents through very exploitative production system. Foreign workers are already 40% of work force.

Workers rights eroded over the years under the BN regime. Labour laws have been amended to allow sub contractors to employ workers for hire in factories and officers. Forming in house unions have become impossible. Existing unions are weakened systematically and lowering job security. The close relationship between government and employers have breed in corruption, kick backs and big lucrative deals for UMNO goons. The civil service policy makers and implementers are clueless on stimulating and reinvigorating the stagnating productivity and efficiency of public sectors. This is stifling the private sector growth and expansion. Institutionalized racism and corruption have hampered and blunted the drive for increased productivity and efficiency. Workers can be made more productive and efficient with equality and meritocracy.

Millions of skilled and highly educated Malaysians go overseas seeking job opportunities. Our lost is other countries gain. UMNO/BN must dismantle the racial quotas and discrimination to increase efficiency and productivity. Structural transformation is compulsory and prelude for socio economic and political changes. Malaysia truly Asia should the pervading spirit in nation building and not just a tourism sloganeering.

MINIMUM WAGE

1. The workers of Malaysia must be happy over the RM900 per month minimum pay. It will give them a higher standard of living.

2. But the minimum wage would I think, cause a domino effect. Those now receiving RM900 per month would not be happy with the idea of their juniors getting the same wages as themselves. To preserve the salary structure their wages must be raised also. And of course if their wages go up those above them would also demand an increase so that their seniority would be properly compensated.

3. So the increase in minimum wage would result in increases in the wages of all categories of workers and employees. Costs of everything must certainly go up.

4. So will the overtime pay. It would be double of the RM 900 per month base salary and quadruple for work after the usual working hours. Considering the number of weekends and holidays in Malaysia, the salary bill would be substantially increased.

5. This increase should not worry the Government. But it should worry the private sector. Already Malaysia’s wages and salaries are higher than all the Asean countries excepting Singapore. It is certainly higher than China. This might deter both domestic and foreign investors.

6. If investments do not come in, the number of new jobs created would be diminished. This might increase unemployment.

7. Unless Government revenue increase substantially the increased salary bill would have to be met by reducing development budget. This will have other unwelcome side effects.

8. I am sure the Government financial experts have already taken into consideration all these things when they advised the Cabinet. It is just that I worry. Some rating agencies have been talking about down-grading this country. I hope they are not serious. Malaysia has always managed its finances well. I am sure that productivity would increase to compensate for the higher wages and overall costs.

Accept Minimum Wage, Do Not Politicise It, Says Subramaniam

KUANTAN, May 1 (Bernama) -- The private sector minimum wage must be accepted and not politicised as it was arrived at by economic experts, said Human Resource Minister Datuk Seri Dr S. Subramaniam.

"The minimum wage was not set by politicians but was based on input from the Technical Committee of the National Wage Advisory Council (MPGN) and the World Bank which studied the matter in depth before the rate was accepted by the councils representing employers and workers," he told reporters after the 2012 National Public Sector Workers Day celebrations here today.

He was commenting on the RM900 and RM800 minimum wage set for Peninsular Malaysia, and Sabah, Sarawak and Labuan respectively, which was announced by Prime Minister Datuk Seri Mohd Najib Tun Razak in Putrajaya yesterday in conjunction with Workers Day.

"Of course, employers want a lower rate while workers want a higher one. There're parties who say it should be more than RM1,200 or RM1,300 but according to the study, if it's more than RM1,000 it would have an adverse implication on our economy and other negative effects such as higher unemployment," he remarked.

Subramaniam said the MPGN technical committee took two main factors into consideration, which were the poverty index and median salary.

He added that the study also looked at the Consumer Price Index, productivity and unemployment rate.

The rates in Sabah, Sarawak and Labuan would be streamlined with Peninsular Malaysia once their economy catches up, he said.

Meanwhile, Bernama spoke to several sources in Kuala Lumpur to obtain their comments on the new minimum wage.

Economist, Prof Dr Barjoyai Bardai of Universiti Tun Abdul Razak said the rate could be a catalyst to increase productivity and boost business for the private sector.

"In Korea for example, the minimum wage is seen as a method to ensure the private sector develops faster than what has been targeted," he said.

"More than 30 percent of Malaysians are earning less than RM300 monthly at the moment and with the new minimum wage their income is raised immediately,' he added.

The Congress of Unions in Government-Linked Companies president Mohamad Shafie Mammal wanted the government to ensure that the rate would be complied by all employers.

"We don't want some employers to take advantage of the situation and retrench workers to 'cut costs'," he said.

The move was welcomed by the Tanjung Malim Proton Workers Union which described it as a motivation for workers to continue increasing their productivity.

The union's president Zainudin Dollah hoped however that the rate would be increased to match the rising cost of living.

The minimum wage would ensure that the basic needs of workers and their families is fulfilled said 1Malaysia Foundation trustee Tan Sri Lee Lam Thye.

"With the resolution of this long overdue matter, workers should be more productive and contribute to the nation's economy," he added.

Speaking for the Malaysian Employers Federation, its executive director Shamsuddin Bardan said the new minimum wage would be a challenge to employers as operations cost may increase.

"It is a big difference, about 30 percent increase and even 100 percent increase for those earning below RM800 or RM900 now," he said.

Najib says will announce minimum wage this month

KUALA LUMPUR, April 2 — Datuk Seri Najib Razak said tonight he will announce a minimum wage policy by the end of the month despite stakeholders still deadlocked over whether benefits can be considered part of a floor wage.

The Malaysian Insider reported today that employers and workers argued in a recent National Wages Consultative Council meeting over whether allowances and other benefits can be included as part of a base wage expected to be set at RM900 and RM800 for Peninsular and East Malaysia respectively.

The committee, which advises the government on wage policy, had met on the back of small-medium industries (SMIs) warning that 80 per cent of active businesses could fold under a blanket floor wage, cutting four million jobs from the labour market.

The prime minister was initially slated to announce a base wage policy last month but The Malaysian Insider understands that pressure from employers has forced the government to return to the negotiating table although any delay will upset trade unions which have said that a minimum wage is long overdue.

“The government has recently announced a pay hike of seven to 13 per cent for 1.4 million civil servants. For the private sector, I will announce the implementation of a minimum wage at the end of the month,” the prime minister said in his live televised address after receiving reports of his national transformation plans.

The Malaysian Insider reported that the 16 mainly Chinese industry associations that called a press conference on March 6 to ask for a staggered implementation of floor wages had first sought out MCA president Datuk Seri Dr Chua Soi Lek for help before lobbying Putrajaya directly.

The Barisan Nasional (BN) government, which has been unable to win back Chinese support so far, has since held several meetings with the associations that are largely made up of SMIs.

Bloomberg reported last month that government officials are preparing for June 3 federal polls and Najib is due to announce a minimum wage of just under RM1,000 a month to win support from low and unskilled labour that makes up 75 per cent of the workforce.

Households earning under RM1,500 per month also make up 40 per cent of the population.

SMIs say they make up 99 per cent of operational companies and employ 59 per cent of all workers as they are the most labour-intensive outfits and will be hardest hit by a hike in wage bills.

They have instead asked for certain sectors and micro-enterprises to be exempted. They also want to be given anywhere between 12 and 18 months to implement a minimum wage.

But labour unions insist that such demands are unreasonable as the minimum wage is to be reviewed every two years.