10MP big numbers that don’t add up

KUALA LUMPUR, June 11 — Datuk Seri Najib Razak yesterday announced the 10th Malaysia Plan (10MP) to transform the country into a high-income nation, but failed to shed light on how this would be achieved.Yesterday’s announcement did not reveal details that will attract RM115 billion yearly over the next five years, needed to grow private investments almost six-fold and the economy by six per cent annually until 2015.The prime minister said that the RM230 billion five-year plan will have 52 high-impact projects costing RM62.7 billion — more than five times the 22 projects costing RM12 billion proposed in the Ninth Malaysia Plan.

Long on proposals and short on details, lawmakers and analysts were left wondering whether Najib can pull off his aim to accelerate investments and cut subsidies to boost competitiveness under his reform agenda.
“It was déjà vu for some of us, we heard it all before in the Ninth Malaysia Plan,” a government lawmaker told The Malaysian Insider, saying the government should also assess the impact and effectiveness of previous five-year plans.But he was confident Najib could make the 10MP work if he can cut wasteful expenses and the 1.2 million civil service workforce down to size.The Barisan Nasional (BN) lawmaker, who did not want to be named, added that Najib — as finance minister — should also enforce good corporate governance in government-linked companies (GLC) to ensure public funds are spent well.

“Najib is giving money to the GLCs but their governance appears opaque. We have to control them as they take more than the subsidies for the people,” he added.Some of the big-ticket projects include a Mass Rapid Transit system circling Kuala Lumpur, seven highway projects at an estimated cost of RM15 billion, two coal electricity generation plants costing RM10 billion, and several property and infrastructure projects such as land reclamation for the West Port, a Malaysia Truly Asia tourist centre and the Senai High-Tech Park that will tap the new RM20 billion Facilitation Fund.The Najib administration is looking at the redevelopment of government land, such as the Malaysian Rubber Board’s land in Sungai Buloh, Selangor, covering an area of 3,300 acres, at an estimated cost of RM10 billion; other parcels in Kuala Lumpur previously identified in the 2010 Budget; five new Universiti Teknologi Mara campuses; making Angkasapuri a Media City; and new transport hubs.The government also plans to complete the federalisation of water supply in the states and solid waste management in the 10MP.

Petaling Jaya Utara MP Tony Pua brought up the issue of transparency in the 10MP, noting that the slew of public-private sector partnership projects were silent on details which went against the spirit of Najib’s New Economic Model (NEM) .“In NEM, it has been expressly stated that there will be no tolerance for patronage, rent-seeking and we’ll be looking at the best proposals, best value for money, open tenders and so on, but what we’ve seen so far is that projects are awarded on a direct basis to specific companies, cronies or otherwise,” said Pua.Political analyst Khoo Kay Peng told Reuters that the PM had to look at the mechanics and the implementation.“That is the part the federal government did not give us in detail, the implementation mechanism. This has been the main problem for Malaysia,” he said.

Khoo also noted that Najib will have difficulty in slashing subsidies as the middle-income group in the country was not large enough to absorb the cuts.“We’re still trapped in the low-income level. We are caught in a situation where you can’t cut subsidies without really improving earning per capita,” he said.The government will cut its subsidy bill to RM15.7 billion in 2015 from RM18.3 billion this year, according to the 10MP proposals issued by the Economic Planning Unit (EPU).But it avoided thorny issues such as dismantling a four-decade old race-based affirmative action policy in favour of the politically dominant Malays, a change that analysts say is crucial for Malaysia to compete with other economies.The issue has touched off a raw nerve among Malaysians who contend that Najib’s BN government must give up its addiction to iconic and mega-projects done under Tun Dr Mahathir Mohamad’s tenure, rather than cut subsidies for essentials like sugar, cooking oil and fuel.The proposed plan to relocate Parliament House to Putrajaya for RM800 million this week brought the issue of the government’s penchant for grandiose projects over the need to focus on the people as espoused by Najib’s “1 Malaysia. People First. Performance Now.” slogan.

In tabling the 10MP yesterday, Najib said it was critical to ensuring Malaysia becomes a fully developed country by the year 2020.“The target to reach six per cent growth needs a massive leap in investments, especially more robust private sector investment,” he added.But investments grew only two per cent on average between 2006-2010, compounding Najib’s problem to reach the 2020 targets, and more importantly, answer critics who say the plans remain on paper and will not take off as the numbers do not add up.

Source : http://www.themalaysianinsider.com/malaysia/article/10mp-big-numbers-that-dont-add-up/