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Governance 101: Wasteful & Short-Sighted Again


(In the Global Competitiveness Report 2010–2011, Malaysia ranks 25 out of 139 countries where public spending & governance is somewhat better managed than the rest but then again, if one reads deeper into the report, Malaysia’s ranking is only 4.2 out of the full 7 on the mark. We are no where close to our neighbour down south who ranks at the top at 6.1 despite their limited natural resources, human resource and living space)

It is scary to hear that the Government has no qualms spending RM650mil annually on something that is not really critical or beneficial to the nation.

PEKAN: A National Service Voluntary Brigade has been launched to further promote volunteerism and tap the services of hundreds of thousands of former National Service (NS) trainees.

Prime Minister Datuk Seri Najib Tun Razak, who launched the brigade in Bandar Chini here yesterday, said the brigade could be roped in to help during natural disasters such as floods, landslides and fires.

The Government has no qualms spending RM650mil annually, or RM8,200 per NS trainee, he said. The number of former NS trainees totals 620,000.

“We see it as an investment in our human resource development,’’ Najib added.


When the National Service was first started, we were kind of understood the need for National Service although we did not really understand why the Government could not have just reviewed the weaknesses of the already existing Rakan Muda program and improve on it.

But still and probably under the delusion of the National Service that has been deployed in Singapore, we went on to see Malaysians by the thousands packed up and sent to National Service camps around the country and despite the well defined objectives and short stint, since the start of National Service, 16 of them had died and there has been other criticisms as well:-

Meanwhile DAP’s Senawang assemblyman P Guna when contacted said that the NSC programme was no more relevant to school-leaving students.

Conceived in 2004 with the aim of instilling patriotism among the younger generation, foster national unity and develop positive character, the programme, Guna said, had failed to meet its objectives and was now merely a benefit to Barisan Nasional cronies.(According to Deputy Defence Minister Abu Seman Yusop until 2008 the government had spent RM2.37 bilionl to finance the programme.)

“There is no comparing our NSC programme with Singapore. “In Singapore a participant must attend the programme for three years. Whereas here they attend the programme for three months only.

“What can they learn in three months? Also why are the 80 camps in Malaysia run by individuals and not the government?” he asked adding that most parents were unhappy with the way the programme was managed. Guna added that the NSC also had a poor track record of safety.

“So far 17 detainees have died and numerous cases of injuries reported. They have also been few cases of sex abuse, racial brawls and harassment. These cases ministry has failed to solve, ” he said.


And now the Najib says that the Government has no qualms spending RM650mil annually on the so-called National Service Voluntary Brigade and for what – to have the ex-National Service trainees to help during natural disasters such as floods, landslides and fires? You think they have nothing else better to do? How about their studies? And even if we were to swallow that half-past six argument, don’t we already have the more well trained and better equipped Fire Department, the SMART team, rescue units under the various local authorities and if need to, RELA for the very same purpose?

And how the Government came to a figure of RM650 million in the first place – uniforms, trainings and accommodations going to cost us that much?? What is breakdown and who is going to get their hands on this money? If we utilize the existing National Service infrastructure and those trainees used back their existing uniform, I am sure we can save a couple millions more. After all, the proposed RM650 million is almost the same as the total expenditure that the “normal” National Service program has been incurring on a yearly basis.

And if the Government really want to invest in the national human resource development, instead of wasting RM650 million a year on some dubious para-military brigade, they can better spend it on building better and well equipped schools, training Malaysians to speak and write better English (and in the same process, kick start the teaching of Science and Mathematics in English), have better teaching skills to teach the younger generation in the country, have more PSD scholarships available for top scorers, more places in the local university and skill learning classes for those well deserving school leavers. Wouldn’t that give human resource development a boost in the long run?

RM650 million per year is a lot of money but unfortunately we have been plagued with a people in power who don’t think twice (or do very little thinking) when it comes to planning out a good strategy and spending tax-payers hard earned money in the best way for national development and wealth.

Couple weeks ago, we have hearing on how our GLC may to lose RM118 million to a mystery British Virgin Island shareholder for doing nothing. And then we read on how the Government has awarded a lucrative RM7 billion highway deal, to be tolled for a record 60 years, to a company known principally for making and selling granular and powder-activated carbon. The existing highway agreements has been crappy so don’t expect this one to be rosy instead.

And there is more on the plate in the coming months – Government is also putting their hands on the EPF monies (certainly there must be an end to this kind of utilization of public pension funds for political social welfare) that may not promise a good return to the EPF members:-

In disbelief I read that funds from the Employees Provident Fund (EPF) — RM1.5 billion to be exact — are to be channeled to a foundation to provide loans to Malaysians who are not able to get a housing loan from a commercial bank. Not only that. The loan would be at a lower interest rate than that offered by a bank. The report quoted Federal Territories and Well-Being Minister Datuk Raja Nong Chik Raja Zainal Abidin as saying that these loans would be provided to retirees and those without steady income.

How can the government take funds which you and I have put aside for our retirement and use it to fund home purchases of those without a steady income? I am all for helping those who are experiencing difficult times, but there has to be another way of doing so.

In case it has escaped the notice of Raja Nong Chik and other members of the cabinet, the objective of the EPF is to set aside funds for employees who do not have any pension scheme. On retirement, the amount the employee and employer have contributed during the employees’ working life is available with interest or dividends to be paid in a lump sum so that the employee has sufficient funds to fund his or her retirement.

The monies belong to the members of the EPF — not the government. The board of the EPF has a stewardship responsibility — to act in the best interests of its members


In banking terms, there is something we called bad debts – on paper, it looked impressive – the loan facility rides on high interest rate and backed by collateral. But once the customer is unable to make the repayment, the reality of things kicks in – the so-called high interest remains uncollected and we can’t even find buyers for the collateral. At the end of the day, the bank loses and writes off the loan as bad debts.

And this is where RM1.5 billion of EPF funds heading to – when you have home buyers who do not have steady income, repayment indication remains very shaky (at lower rate than the banks too) and I am sure EPF is going to find hard time selling off low cost units (even if it does, it is going to be after a huge discounts). Will we see some kind of bailout in the end?

And another endeavour that is waiting for major fuck-up if not managed well is the 1Care proposition which already creating fiasco with fellow Malaysians:-

The government is about to introduce a mandatory national healthcare system called 1Care, which will force all employees to give up to 10% of their monthly income to pay for basic healthcare. This has created an atmosphere of fear among the people as to the uncertainties of the medical facilities made available to them and their families.

While it may be a noble idea to come with a comprehensive national healthcare system to provide quality and affordable medical services for the people, it has to make sure the people at large, in particular the lower income group are ready for such a scheme, which will further drain their already meagre resources.

According to the planned scheme, despite paying a hefty sum every month, one:-

1 Cannot choose the own doctor but go to the one assigned by a healthcare provider appointed by the government. These healthcare providers are usually managed by non-medical professions, and are basically run on profit-motivated financial systems.
2 Can only see the assigned doctor six times a year free
3 Can only see the doctor for one problem at a time
4 Get only cheaper generic medicine and not the patented drugs that are more costly.
5 If one wants a doctor of his choice or patent drugs he has to pay more for them.


In his blog, Lim Kit Siang further reports:-

Each year, we all pay a total of RM44.24 billion a year for healthcare – now called National Healthcare Hospitals and clinics ( an integration of public hospitals and clinics, private hospitals and private GPs. which in essence is a privatisation of public and nationalisation of private healthcare facilities). All this will now go under 1Care. This means 1Care will get almost RM45 billion a year. The administrative cost is likely to be 10% or about RM 4.5 billion

Can we manage the remaining RM40 billion wisely and ensure that it is used wholly for national healthcare services and ensure that it does not end up in some crony’s personal pockets (heavily disguised as “commissions” and “other services” perhaps)?

This all really shows that it has been sometime since we got someone very brilliant and highly responsible in running the Finance Ministry – someone who is bent on maximizing the income for the Government (by closing the loop-holes for corruption, tax-evasion, etc) whilst at the same time, slashing down unnecessary expenses and then with the funds available, prioritizing the spending of the limited resources for the right, non-political biased purposes.

We have been seeing millions wasted on unnecessary and often bloated national projects, advertisements, “you help me – I help you” election giveaways (beware – latest scam is called nambekei), cash giveaways to public when there is limited funding in other areas and uncontrollable corruptions (we already lost RM1.08 trillion todate to corruption). And when there is no money left, the tax-payers are asked to pay, one way or another for the Government to spend even more and more to crony’s and corrupt politician’s own pockets – that is indeed sickening.

Because when you don’t the money to provide loans for low income Malaysians to purchase own homes or when there is not enough to cover the national health care and can’t even manage the available money, throwing another RM650 million down the drain is the last thing one needs to manage the limited resources.

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