Tuesday, February 28, 2023

Where is the reformasi?

Following his dismissal as Deputy PM and UMNO member, Anwar Ibrahim started the reformasi movement as his political platform. 

After 25 years, he finally managed to step into the Prime Minister's Office he was involved in the development of Putrajaya. Over time, he has articulated on the repeated over many elections of the corrective programs he wish to undertake. 

The social media is now regurgitating the promises and manifesto items he made under the then Pakatan Rakyat at GE 12 and 13 and later the Pakatan Harapan's for GE14. 

However, Anwar is not expected to deliver in abolishing PTPTN student loan, 20% royalty for Sabah and Sarawak, change the Wang Ehsan for certain states in Peninsular to royalty, immediate cut in the retail oil prices by 50 sen and the list can be longer. 

Understandably, the government is in a slippery situation constrained by debt and revenue shortfall. Many of the promises have rightly been pointed out by then BN government of the day as ridiculous.

To be more rational and mature in our politics, lets ignore the usually mindless and deceptive campaign sloganeering.  Election promises are sensational but seldom delivered. 

But the 25 years of chanting, "Reformasi!" is ideological and cannot be put at bay.


As for the budget, the bulk of spending is  meant for operational expenses and limited sum for developmental. 

Where is the next source of revenue and growth supposedly to be formulated by Economic Minister, Rafizi Ramli without a development or economic plan and fund?  

The government is borrowing to pay for operational expenses. Something no company the SC and Banking community would allow. Neither should government.

The Edge published a critic from Anwar's own supporters, below:       

Budget 23: Another Missed Opportunity

Ramesh Chander, Murray Hunter and Lim Teck Ghee/theedgemarkets.com

February 27, 2023 14:50 pm +08

Mainly status quo, part recovery, and part election oriented, various excuses can be made for the 2023 budget produced by the new government kicking the can of fiscal and institutional reform further down the road. 

In his budget presentation, the Prime Minister, also the Finance Minister, had asked: “the question is whether there is political will to effect change” to what he diagnosed as the challenges facing the nation: high debt level, low quality of administration, global uncertainties, slow investment recovery and the Rakyat’s economic woes.  

However, with lack of time, Anwar’s administration had less than 90 days after coming to office to produce the new budget. In addition, he crafted the budget with the looming state elections in mind, where perhaps it is not surprising that the rhetoric of change and reform has largely remained rhetoric. 


The first part of our commentary before the budget presentation (see “My Say: Case for a Reformist Budget 2023” https://www.theedgemarkets.com/node/654998) was to stress the need to tackle long overdue reforms such as restructuring the economy, reforming the tax regime, and reforming EPF. However it is clear that what has emerged is based on the original 2023 template presented by former finance minister Tengku Zafrul Tengku Abdul Aziz last October before GE15 - that is mainly cosmetic reform. 

As a consequence, Anwar’s first full budget since 1997 is the largest budget presented in Malaysia’s history. But bigger is not necessarily better especially when it results in further bloat of the public service and little evidence of substantive institutional and governance reform measures.

Expenditure: Total forecast spending is RM 386.14 billion, of which RM 145.5 billion is spent on salaries and operating expenses, RM 58.6 billion in subsidies, while RM 97 billion is planned spending on development. The balance is on retirement charges (RM 30 billion), debt service charges (RM 45.94 billion), payments to states (RM 8.1 billion). 

Receipts: This will be financed by RM 291.5 billion in revenue, made up of RM 218. 2 billion in tax revenue, and RM 73.3 billion in non-tax revenue.

This leaves a budget deficit made up from borrowings and payments from GLCs of RM 94.60 billion.

Disappointment with more of the status quo 

There are no reforms undertaken on the EPF system, only some token assistance where balances under RM10,000 will receive a RM 500 top up. This is even though there is a retirement crisis in Malaysia. Likewise, rather than any tax reform, there will be a 2 percent decrease in tax rates for the B40 group, and an up to a 2 percent tax rise in the T20 group. Taxation revenue will become a crucial issue for future governments, if reform is not undertaken.

The budget fell well short of the income safety net promised by both Pakatan Harapan and Barisan Nasional before the election. The social assistance allocation of RM 8 billion to cover the needs of 8.7 million people will amount to RM 920 per person per annum.  What has been dismissed as “paltry, one-off handouts” by a senior trade union official as opposed to a holistic approach to rectifying the fundamental issue of low wages continues to hold back the B40 and M40 income population. 

Not exciting for SMEs

Assistance to SMEs will largely be in loans, with priority to developing automation, and may run into delivery problems. Government criteria may be too tight, making many SMEs ineligible. The funds allocated for automation and digitalization may not all be taken up, due to most SMEs being only ‘hand to mouth’ operations and not able to match grants. Tax incentives will be of little use to SMEs which have not been able to make profits and are technically insolvent. There is a risk that the Khazanah Nasional and EPF innovative and high-growth start-up companies RM 1.5 billion investment scheme will benefit only wealthy and connected companies as well as be largely expanded on consultancy services.

Food security 

Bernas sharing 30 percent of net profits on rice imports, offering RM 1 billion in loans and tax incentives is not going to assist in enhancing food production. Technological grants for private investments may not be fully taken up by farming enterprises or may end up with sham politically connected companies. Little is being done to lower the cost of production, through decreasing input duties on farm inputs. There are still APs in place on many food items, which is contributing to artificially high costs.

The key forgotten reform

A special task force to reform government agencies is a small step in the right direction for enhancing the efficiency of government. This should be expanded to a full study of government, from ministries down to agencies, to determine where bloated staffing levels and inefficiencies exist and where necessary action can be taken to rightsize before the next budget. 

One interesting aspect of this budget is that the finance ministry, of which Anwar is minister, had its allocation of RM29.87 billion raised to RM 67.24 billion, a rise of 125.1 percent. This is a massive increase, enhancing the power of the finance ministry over the government. The government has forecast RM58.6 billion in subsidy payments for 2023. Many of these subsidies, such as RM 1.8 billion for rice farmers will continue to ensure the paddy industry remains inefficient. RM 200 to be paid to youths between 18-20 will just be wasted and not assist these people to empower themselves. GLCs offering 35,000 new job opportunities to youth, TVET graduates, veterans, and other vulnerable groups is just going to add to the inefficiencies of these organizations. This new laundry list of giveaways may provide short term political gain to buy the new government time but the economic returns are largely illusive.   

The Prime Minister had promised to share “the real facts” rather than opting for “captivating” figures to accurately present the state of the nation. The budget presentation was a missed opportunity.

Datuk Ramesh Chander is a former Chief Statistician of Malaysia and a Senior Statistical Adviser at the World Bank in Washington D.C.

Lim Teck Ghee is a former senior official with the United Nations and World Bank.

Murray Hunter is an independent researcher and former professor with the Prince of Songkla University and Universiti Malaysia Perlis

That is economics. 


Where is the reform on judiciary with Chief Justice and Attorney General adamant to protect a conflicted judge and corrupt Central Banker.

This has raised serious questions on the validity of the judgement of 9 judges and exposed a blatantly corrupt, bias and politically manipulatable justice system. 

Integrity and corruption

Anwar is appointing and extending the same bunch of personalities with questionable integrity in political and governmental position. He failed to research their background.

Corruption and leakages in government is in abundance but no serious and decisive plan with specific measures to address. 

Only talk, talk and talk as only red herrings being pursued and the real McCoy still at large.


Anwar is talking too much, commenting on every other unnecessary and petty issues, and replying to the most irrelevant of critics. 

People will eventually lose interest with "we plan to blah blah blah and blah blah blah". He need to win the peoples' confidence with decisive actions.  

It is time for Anwar to take his job more seriously, carry himself as a leader and stop basking in the limelight. He need to stop goofing around, maintain his composure, and not ghaflah (be steady).


Anwar should have the personalities ready and not still scrouching till his 100-day to assemble a credible team.

He seemed to recycle the same bunch of people from past administration with known links to those with integrity issues and part of past suspected wrongdoings. 

Do a proper background check. Key appointments in his Ministry of Finance and PMO seemed to remain loyal to his predecessors.   

There are those inside that may have leaked the budget. A neighbouring country preempt with an announcement days before the tabling to take advantage of tax policy plan.

No guarantee

Currently there is no better alternative to Anwar for national leadership. No leader in the present line-up of UMNO or PPBM are PM material. 

PAS leaders are too myopic and parochial to even consider. DAP is not yet acceptable to the majority Malays and Bumiputera. 

There are leadership talents among East Malaysians but they must want it.

Kudeta 2.0

Nevertheless, if Anwar fail to bring back public trust and exude the confidence one expect of a leader, he may not complete his tenure.

He cannot be talking of planning for this and that but its merely trying to gauge public responses. Plan, and execute the policies and actions needed. 

Then talk to convince and motivate the public of the necessary difficult choices and command support for a major plan forward. 

That is leadership.  

Muhyiddin is right to say Anwar cannot be there forever. No one could, not even Muhyiddin and all is a matter of when. 

If the Muhyiddin backed people take control of UMNO, he could return as PM or god forbid, Anwar's nemesis, Hamzah Zainuddin is the new PM. 

The oft chance to happen is July or August. Take this reminder seriously!

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