Friday, November 28, 2008

malaysiakini on MORE GOVERNMENT WASTAGES

The Malaysian government behaves as if it has a Treasury that is unlimited and even the global financial crisis sees it in a extravagent mood.
Firstly, according to this malaysiakini article, those over-generous IPP concessions that cost RM8 bil in excess capacity.
Now we have reserve capacity of 40% instead of a more reasonable 20 to 25% and TNB has to pay the IPPs. If IPPs install capacity in excess of their allowance, they should not be compensated and perhaps MPs should demand the IPP agreements be disclosed for a public debate.
The other aspect of government excesses as described in this NST article is that now more than 40,000 civil servants are being given the option to receive their pension .
I wonder if this is the result of the poor response to reduced EPF deductions to encourage more consumer spending?
If 40,000 people do not have to put away say RM100 monthly EPF on average, that means RM4000000 monthly will boost spending.
Of course taxpayers will bear the brunt of this generosity in the long term as already our cost of civil servants is spiralling with no sight of any control.
Just to compare with Singapore, top civil servants have to take a pay cut of about 15% next year.
In Malaysia, the problem is worsened with high pension costs and escalating medical claims. So far there are no studies done on derivative pensions caused by multiple families that can span more than 50 years.
For medical bills, I suggest all retirees be entitled to just 2 categories - third class and second class for officers. Civil servants should be encouraged to buy health insurance if they want better benefits.

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