Showing posts with label Salary. Show all posts

Tuesday, 6 December 2022

PM: No salary for me at all, Cabinet ministers to take 20% pay cut

– BernamaAll eyes and ears: Anwar chairing the first special Cabinet meeting of the Unity Government at Perdana Putra.

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PUTRAJAYA: Datuk Seri Anwar Ibrahim will not receive any salary, both as Prime Minister and as Finance Minister, he has clarified.

Cabinet ministers have also agreed to a 20% pay cut until Malaysia reaches economic recovery, he said.

ALSO READ: Zahid and Fadillah have role in bridging economic gap

Rubbishing talk that he would be paid as Finance Minister although he had declined the salary for the top job, Anwar announced he would not be taking any form of government salary.

This was in line with his promise made during the election campaign, he said.

During the campaign, Anwar had said he would not take a salary if he was appointed as prime minister because the people themselves were struggling to cope with rising costs.

“Some people say I’m not taking the Prime Minister’s salary because I am the Finance Minister. That’s not true. There is only one salary,” he said, laughing off such claims during a press conference here yesterday.

ALSO READ:Budget to be enhanced with MOF, Cabinet views

The Members of Parliament Act (Act 347) only allows one salary for ministers, deputy ministers or political secretaries.

On the Cabinet ministers’ pay cut, he said this was their way of acknowledging the tough times faced by the people.

“The pay cut will be implemented as long as Malaysia continues to recover economically.

“It shows the ministers are also concerned about the livelihood of the public,” he said.

Asked if the pay cut would be carried out throughout the government’s five-year tenure, he simply said that it could range from three to five years, depending on the situation.

Cabinet to take 20% pay cut

Prime Minister Anwar Ibrahim thanks his ministers “for their willingness to make some sacrifices” and said this was to show the government’s concern for Malaysians.

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Friday, 13 July 2012

Our cars are costing us our homes!

WHEN I first started my job as an architect in the 1960s, I was on a three-year contract with a monthly salary of RM628. I bought my first car, a Peugeot which cost RM7,724, equivalent to approximately one year of my salary. The car became my reliable companion for 14 years. Those were the good old days, when a car could be bought with just one year of a fresh graduate's salary.

Circumstances have since changed. Today, for a fresh graduate to own a car in Malaysia, it will easily cost him four years of his salary to purchase a foreign car, and even a local car costs around two years of his salary. If we take into consideration his living expenses and other commitments, it may take him even longer to settle his car loan. Hence, it has left him with very little option but to take the maximum car loan financing tenure of nine years.

In the table illustration below, a fresh graduate in the Washington D.C. earning about RM11,000 (about US$3,500) per month can easily buy a Japanese Honda Civic or Toyota Corolla worth RM50,000 as it is only 0.4 times of his yearly salary.

On the other hand, a fresh graduate in Malaysia earning about RM2,500 per month needs to pay RM120,000 if he would like to buy the same type of car. It costs him four times his gross yearly salary. This ratio is 10 times higher than his US counterpart.

For youths in Malaysia, buying a car is more expensive both in real terms, and in terms of debt-to-income ratio. In reality, it means they have to either purchase a car with lower price tag or commit to a longer term loan to own a car, which cost them the opportunity of owning a home.

This situation requires our youth to choose between buying a car or a house first, and many have committed to own a car first, considering our public transportation system is still in the process of being improved.

Many fresh graduates in Malaysia who start to serve their car loan tend to delay their plan of purchasing a home.

Unfortunately by the time they can afford to purchase a home, be it three, five or nine years later, the price of a property would have escalated due to among other things, inflation, higher construction cost and higher land prices.

While it may be safe to say that their salary would also increase, generally speaking the increment may not aligned to the rate of inflation. In most cases, owning a home will be a huge debt lasting 30 to 40 years of housing loan repayment.

What can be done differently to change the circumstances? Is there a better way for them to financially plan their future? These are questions that Malaysian youths ought to consider before purchasing any big-ticket items.

Let's look at the table again. It also lists the median price for three-bedroom apartments in the suburbs of these cities. The median price of an apartment in the Klang Valley is around RM300,000, equivalent to 10-year gross income of our fresh graduates. The affordability level is more favourable compared to other Asian countries, such as Indonesia and Thailand. The prices of same size apartments in Jakarta and Bangkok range from RM350,000 to RM400,000, and costing their fresh graduates 13 to 18 years of gross yearly income to purchase a house.

Therefore, when it comes to the question of home affordability in Malaysia, we are blessed compared to our regional peers.

However, there are many factors that contribute to the challenge for our youths to own a house. Two primary factors are the additional financial commitment of purchasing a car, and the relatively lower income level in our country compared to our Western counterparts.

When fresh graduates spend a substantial amount of their salary paying for a car, they are left with little savings to own a house, and their house affordability level decreases over the years as prices rise due to inflation.

Clearly the income level of our graduates has to rise, to enable better quality of living and higher affordability level, which is the current government's focus to make Malaysia a high income nation by 2020.

Perhaps it is also time to re-look at our national car policy and how it has affected the house affordability level in Malaysia. From the numbers above, it is clear that our cars are costing us our homes.

Food for thought By DATUK ALAN TONG

> FIABCI Asia Pacific chairman Datuk Alan Tong has over 50 years of experience in property development. He was FIABCI World president in 2005/06 and was named Property Man of The Year 2010. He is also the group chairman of Bukit Kiara Properties. (email at feedback@bukitkiara.com)

Related post:

'No’ to property price speculation

Houses prices hardly fall

Tuesday, 11 October 2011

A 10-step plan to improve inefficient civil service in Malaysia!

A 10-step plan to excellence

Question Time By P. GUNASEGARAM

Cutting the numbers, raising salaries of good employees and emphasis on efficiency are some of the keys to improve the civil service.

COMPARISONS with other countries indicate that we have too many civil servants for the population (about 25 million). Some 1.3 million civil servants, together with retirees, accounted for nearly two-fifths of the Federal Government’s operating expenditure last year of over RM150bil.

A bloated civil service not only sends the wrong message by keeping too many people unoccupied, it also leads to a considerable waste of government revenues and needlessly high expenditures which could have been better utilised elsewhere.

There are two sides to a large, inefficient civil service. As the numbers come down, you need to increase the rewards to retain the better people and improve the quality of entrants.

For illustration, if you cut the number of people in service by 50% and increase salaries by 50%, you actually save 25% in costs.

That may be too drastic a cut even for the civil service but a target to reduce it by a third over five years by natural attrition, getting rid of incompetent, lazy staff and very selective and prudent hiring is possible.

To encourage people to stay in the service and to recruit new, more able people, the salaries can potentially be raised by a third over five years.

Despite the salary increase, there will still be savings in costs of about 11% – if you don’t believe me, you can work it out yourself.

Remember too that the one-third salary increase need not be – indeed should not be – across the board.

It should be tweaked to give good ones better increases and bad ones smaller or no salary increases at all.
But this needs to be done under a clearly specified framework to prevent abuse.

As with many other institutions, the civil service has become highly politicised and some top civil servants have taken after the image of their political masters, demanding special treatment, special privileges and keeping their noses in the air.

They have come to consider themselves a law unto themselves and not only neglect the rakyat who they are supposed to serve but treat them with contempt, disdain and disrespect, leading to an outpouring of complaints against them, which they coolly ignore.

That attitude needs an about-turn.

It is therefore very timely that the Budget is now addressing some issues surrounding the civil service, including a mechanism to remove non-performers in the civil service. Hopefully, something will come out of that.

Meantime, here’s a list of 10 things which are imperative for change in the civil service and a move towards excellence.

1. Eliminate corruption and patronage. As has been pointed out, delays are in themselves a cause for corruption because people will seek to use nefarious means to avoid them, such as pay to put a file on top of the pile. While efficiency builds up, it is necessary to take a strong stand against any kind of corruption and patronage at all levels. The best way to do this is to issue a stern warning and take action against anyone found to be flouting the rules.

2. Recruit, reward and retain the best. You can’t have an excellent civil service without excellent people. You must recruit the best people, give them the right rewards and incentives and do your best to retain them by giving them more responsibilities, promoting them and giving them incentives.

3. Make service the aim. Considering the shabby treatment that many Malaysians receive at government departments, including the police, it is clear that the concept of service is alien to many civil servants. They exist for the public, not the other way around, and their assessment must include how well they satisfy the public in the performance of their service. This leads us naturally to our next point.

4. Encourage and act on public feedback. All counters which deal with the public must have ready feedback for public complaints. If a member of the public feels he has been badly treated, he must be given the immediate right to speak to a superior and make a complaint on the spot. Video cameras can be installed to help obtain the actual sequence of events. Superiors must act on public feedback and if a civil servant treats badly a member of the public, he must be punished.

5. Make it Malaysian. The statistics indicate that before 1970, the civil service was more Malaysian in that it better reflected the racial composition of the country compared to now when an estimated 80% or more of civil servants are bumiputras. This often leads to allegations of bias and a civil service that is not always sensitive to the needs of different races and cultures. Efforts should be made to recruit more non-bumiputras into all areas of the civil service. With an accompanying improvement in salary and benefits, it should not be a problem.

6. Use measurable standards. For performance appraisal, it is always good to use a measurable goal such as number of people seen in a day for a counter service, or number of projects approved. The goals will be different for different departments and for different levels within the same department but an effort should be made to quantify effort, even if work also has to be assessed qualitatively. The important thing is to keep any kind of bias out.

7. Reward good work. For any organisation to be vibrant and vital, it is important that good people are rewarded by offering them better increments, promotions and being put on the fast track for movement up the organisational ladder. That helps to ensure that as they progress, there will be increasingly better people at the top.

8. Punish poor work. The first part in dealing with poor work is to try and remedy the situation by pulling up the person, helping him, and giving him the means, the time and help necessary to do the job properly. If this does not get improvement, then it is necessary to reflect this in his benefits, clearly explaining what he will have to do to get back on the growth path. Sometimes even this fails, which leads us to the next point.

9. Get rid of deadwood and incompetence. If sufficient effort has been made to rehabilitate a worker and if that still fails, then the Government has no choice but to sack the worker. Clear procedures must be put in place so that there is no discrimination and that all inquiries are properly conducted before dismissal.

10. Keep political interference out. Sometimes, it is the politician who keeps the civil servant from performing his job. Politicians should set policy with input from the civil service and in the process they must have respect for the expertise developed within the service. Once policy is set, they must allow the civil service to implement it without hindrance, only interfering if the civil service baulks at implementing policy.

Few countries have become world class without an excellent and efficient civil service to support the transformation. If we don’t elevate our civil service significantly to much higher standards, we are all going to be losers.

> Managing editor P. Gunasegaram loves how he can renew his passport in just one hour, a clear indication that the civil service can perform.

Rightways to Success

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