Archive for the ‘Others’ category

Budget 2012

October 7th, 2011
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You might want to have a peek at Budget 2011 last year to get an idea of this year’s budget. This year around, PM Najib spoke for an extra 19 minutes. The budget speech can be found here.

The budget costs RM232.8 billion, up 9.4%, with the operating expenditure at RM181.6 billion or 78%, (up 11.5%) and development expenditure at RM51.2 billion or 22% (up 4.1%).  RM20.5 billion would be for servicing debt.

You can compare with Pakatan Rakyat’s shadow budget here.

Last year, Malaysia’s FDI growth was the strongest in Asia and in the first six months of this year have reached RM21.2 billion. Economic growth for 2012 is expected to be between 5 and 6 percent, despite a global economic slowdown. In 2012, private investment is forecast to climb 15.9%, supported by foreign and domestic investment. GDP in the first 6 months of 2011 was 4.4%, driven by strong domestic consumption. In 2012, the service sector is expected to grow 6.5%, the construction sector 7% and GDP is forecast to be between 5 and 6%.

RM29.8 billion allocated for investment in infrastructure, industrial and rural development. RM13.6bil allocated for the social sector, including education and training, welfare, housing and community development.

Some of the main points:


  • Government to further liberalise 17 services sub-sectors, including healthcare and logistics, and in places enabling 100% foreign equity. This will allow 100 per cent foreign ownership of  the 17 service subsectors.
  • RM18 billion of the RM20 billion PPP Facilitation Fund will be used for high-impact projects, with RM2 billion for bumiputera entrepreneurs.
  • KL International Financial District –  income tax break 100% for 10 years, duty stamp exemption; development allowances and capital allowances; income tax break 50% for property developers in KLIFD
  • RM978 million allocated to accelerate the development in five regional corridors: Coastal Highway JB-Nusa Jaya; Taiping Heritage tourism project; Besut agropolitan project; Lahad Datu palm oil cluster project; Water supply in Samalaju
  • Felda to be listed in Bursa, along with “windfall” for settlers.
  • To extend tax exemption on issuance and trading on foreign currency sukuk by three years
  • To cut tax for three years on expenses incurred in issuance of sukuk wakala starting 2012.
  • To implement RM6 billion private sector-financed special stimulus package for infrastructure works.
  • To implement RM98.4 billion rolling plan until 2013 for high-impact development projects
  • To grant tax benefits to investors who use Malaysian Treasury Management Centre to accelerate financial markets development. These include income tax exemption of 70 per cent for five years, withholding tax exemption on interest payments on borrowing and stamp duty exemption on loan and service agreements.
  • subsidies will be maintained at same amount (RM33.2 billion).
  • franchise fees borne by local franchisees will be allowed tax deduction in efforts to develop the local franchise industry and Malaysian brands.
  • Pulau Langkawi will be redeveloped with the Langkawi Five Year Tourism Development Master Plan, to be launched with an allocation of RM420 million to be used to restructure the Langkawi Development Authority, set up a park rangers unit, upgrade museums, beaches and small businesses as well as provide a more efficient transportation system.
  • Hotel operators in Peninsular Malaysia investing in new four and five-star hotels will be given pioneer status, with 70 per cent income tax exemption or 60 per cent investment tax allowance for five years.


  • RM1 billion allocation through a special fund for the construction, improvement and maintenance of schools in need of upgrades. RM500 million would be allocated to national schools while Chinese and Tamil vernacular schools, mubaligh schools, government religious schools and Mara junior science colleges will receive RM100 million each. (as usual, too little for vernacular schools).
  • development allocation amounting to RM1.9 billion would be spent on all types of school consisting of national schools, national-type Chinese and Tamil schools, mission schools and government-assisted religious schools
  • Abolishment of school fees for primary and secondary education. Currently, students in primary and secondary schools are still required to pay RM24.50 and RM33.50, respectively, for co-curriculum, internal test papers, Malaysian Schools Sports Council fees and insurance premium. These payments will be abolished from 2012
  • One-off RM100 for each school pupil aged six to 16
  • One-off RM200 cash voucher for books  for all school pupils and higher learning institution students
  • Private schools to get 70% income tax break, 100% tax allowance for up to five years, double deduction for overseas promotional expenses to attract more foreign students and import duty and sales tax exemptions on all educational equipment.

Civil Service

  • Civil service salary hikes of between seven and 13 per cent (for those who accept the new scheme, SBPA).
  • Increase in the rate of automatic annual increments in civil service salaries of between RM80 and RM320 (not salary revision as many report/understand).
  • retirement age raised from 58 to 60.
  • teachers to be given promotion on time-base promotion.
  • Tuition fee assistance for civil servants who want to study part-time – for 5,000 places for masters and 500 places for doctorate degrees. Total allocation – RM120 million


  • One-off cash payment of RM3,000 for each family of ex-military and police personnel who served the country during a decades-long communist insurgency (62,000 families)
  • RM200 million for upgrade to modern policing and RM442 million to upgrade housing quarters, stations and training.
  • RM500 million under the Army Care programme for upgrade and maintain army camps and quarters.
  • RM50 million for ex-servicemen retraining.


  • Increase of 2% annually for pensioners starting from 2013.
  • bonus RM500
  • 50% discount on LRT and monorail
  • no outpatient fee for government hospitals/clinic including dental clinics (doesn’t make much difference because its the medicine that costs a lot)


  • full exemption of import tax and excise duty for hybrid and electric cars to be extended until end of 2013.
  • 100% excise duty and sales tax exemption for locally-made taxis.
  • No excise duty or sales tax for transfer ownership.
  • No road tax for individually-owned budget taxis.
  • 2% subsidy on loan for new locally-made taxi.
  • RM3,000 assistance for disposal of old taxies exceeding seven years but less than 10 years. If 10 years old and above, RM1,000 is given. (wonder what’s the focus on taxis is all about. I thought we have too many taxi licenses?)


  • Real Property Gains Tax increased from 5% t0 10% if property sold within 2 years, 5% if sold between 2 and 5 years, and no tax if sold after 5 years.
  • Ceiling for house prices under a government deposit guarantee scheme for first-time house buyers to be raised to RM400,000 from RM200,000 (My First House Scheme)
  • RM443 million fund to build 15,000 units of housing for lower- to middle-income earners


  • 1% increase in employer’s EPF contribution (12% increase to 13%). (Most likely to cause unhappiness among employers).


  • One-off cash assistance of RM500 to all households with a monthly income of RM3,000 and below, costing RM1.8 billion, to benefit 3.4 million households (54% of households). Head family must register with LHDN.

Orang Asli

  • RM90 million for basic needs, including treated water and income generation, RM20 million for the community affected by Cameron Highlands landslide.
Rural Development
  • RM1.1 billlion for rural electricity supply, especially Sabah and Sarawak.
  • RM5 billion will be given to develop rural infrastructure, including RM1.8 billion to the Rural Road Programme and Village-Link Road Project.
  • RM2.1 billion allocated to expand clean water to rural 220,000 homes.
  • The government will expand the programme to supply clean water to the rural community in Sabah by RM50 million.
  • In Felda settlements, RM400 million upgrade of water supply system in Pahang, Kedah, Kelantan and Terengganu.
  • RM150 million for rural public transportation, via SME bank for bus companies in low interest loans of 4% interest
Poverty/Low-income issue/Welfare
  • Build 85 government-subsidised discount grocery stores nationwide (Kedai 1Malaysia)
  • RM20 subsidy for electricity bill to be continued (only if your bill is RM20 or less).
  • RM1.2 billion for welfare programme: for senior citizens RM300 per month, poor children RM100-450 a month, disable RM150-300 per month.
  • To open 30 Agro Bazaar Rakyat for agriculture products.
  • Extend Menu Rakyat 1Malaysia to 3,000 operators, where breakfast provided at RM2, lunch at RM4.


  • To establish RM2.6 billion worth of funds for small and medium enterprises (SMEs).
  • RM100 million SME Revitalisation Fund, for loans of up to RM1 million made available for entrepreneurs to be made available from January 2012
Social Justice
  • contributions to missionary schools and houses of worship will become tax exempt (hopefully its not an excuse to reduce allocation. As it is, there’s no mention of any allocation in the budget for houses of worship).
  • RM15 billion operation expenditure and RM1.8 billion for development expenditure. Upgrade of 81 rural clinics and 50 new 1Malaysia clinics.
  • Hospital Kuala Lumpur, the oldest in Malaysia, will be upgraded to be the country’s premier hospital. RM50 million to construct outpatient block for Hospital Kuala Lumpur. This will come from the RM300 million allocation to upgrade the hospital with new equipment


  • Aim to build 150 futsal courts and 30 football fields with artificial turfs. RM50 million allocated for football fields, RM15 million for futsal courts (We get rid of open areas and then scramble to build courts/fields again).

This time around, the impact for those in the middle income (household > RM5000) and those who are single can’t be found. There’s no mention of income tax reduction, nor any sin tax. There are plenty of benefits, but my worry is that its value is quite small until can’t make any immediate crucial impact for citizens. Perhaps the housing schemes and education benefits would be the ones which are impactful enough. Good thing that the subsidies are maintained for the coming year.

The budget targets the relevant groups: police/military, Felda, teachers, pensioners, retirees, rural areas, East Malaysia, civil servants.


Pakatan Rakyat’s shadow budget

October 4th, 2011
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Update: Some details of the shadow budget is available on Lim Kit Siang’s blog here.

I haven’t read the federal opposition’s shadow budget in full, but only the points mentioned in newspapers. The budget costs RM220 billion and will reduce the deficit to 4.4%.  Revenue is RM181 billion, with the expected income from auctions of approved permits (APs), higher oil prices and reintroducing import tax on 200 luxury items that was lifted by federal government last year.

The shadow budget proposed that

– RM22 billion is used for subsidies

– RM5.9 billion to implement minimum wage of RM1100 for civil servants

– reallocate RM10 billion from PM’s department to other ministries.

– an annual allowance of RM1,000 to be given to mothers to encourage them to enter the workforce

– a RM1,000 bonus for senior citizens with annual income of less than RM18,000 as well as for qualified housewives

Other details are not available yet, so I’m not sure how the budget will be provided for.  The news in cyberspace so far seem to indicate a less than enthusiastic response, mainly with the proposal to implement minimum wage for civil servants.

I would have proposed that bonus for senior citizens to be RM3600 instead of RM1000, probably in the form of vouchers. The annual allowance of RM1,000 for mothers also too little. I would have proposed to have a compulsory creche/nursery in workplaces or buildings with tax incentive given to those employers who provide such facilities. Also, provide tax incentive to those employers who promote telecommuting. Maybe also encourage employers with more than 500 employees to provide bus free services to their employees to reduce pollution and traffic jams.

I would also propose a big allocation for education to implement single session schooling which can kill many birds with stone.

I would also proposed a gradual reduction in civil service size in line with the international norms, which can help alleviate the salary increment cost. Probably also toss in some privatization exercise to reduce size of civil service.

We have to wait till Friday to see how the federal government’s budget turns out before able to make any comparison.



PM announced declarations and laws to repealed or amended

September 16th, 2011
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 You can read PM Najib’s full text of the Malaysia Day speech here. The crux of the speech came towards the end, where he announced some major proposal (since its yet to made formal, presented in Parliament and approved).  Things can change from what’s been announced, so we shall keep our fingers crossed. However, it is a good move, something that can improve our ratings in the various rating systems and improve public perception. In a way, the pressure by the opposition and public have sped up the inevitable decision, IMHO. The perceived abuse of such laws over the years only served to undermine whatever good things done by the government of the day.

The repeal of Printing Presses and Publications Act is a pleasant surprise, at least for me. I kind of expected some sort of changes on the human rights laws, but not on the media law. A good news indeed.

Anyway, it is left to be seen how the new laws which are meant to replace some of the repealed ones will be. Hopefully it won’t be new wine in old bottles.

  image from The Malaysian Insider


The Star also provided a rundown on the said Acts:

Laws to be reviewed

Printing Presses and Publications Act 1984

1. The Home Minister:

> has absolute discretion to grant any person a permit to print or publish a newspaper in Malaysia.

> may at any time revoke or suspend a permit for any period he considers desirable.

> makes the decision to refuse, revoke or suspend a licence or permit and his decision is final.

2. Any person who commits an offence, including printing, importing, producing, publishing and distributing any prohibited publication commits an offence and is liable to not more than three years imprisonment, fine not more than RM20,000 or both.

Restricted Residence Act 1933 (to be reviewed)

1. The Home Minister:

> may order the arrest and detention of any person he deems necessary to reside in any particular area or prohibited from any particular area or areas.

> may make an order for the person to reside in the specified area or prohibited from entering specified areas from a set date.

> may at any time revoke, cancel or vary the order.

> may order the person be put under police supervision for not more than five years and may renew any such order for a further period or periods not exceeding one year at any one time.

2. Any person found within any area, town or village that he is prohibited from shall be liable to imprisonment for a term not exceeding three years.

Laws to be repealed

Banishment Act 1959

1. The Home Minister:

> may issue a warrant for the arrest and detention of any non-Malaysian or exempted person if he judges there are reasonable grounds for banishment, on receiving written information submitted to him by the Inspector-General of Police or a chief police officer.

> may order that this person be banished from Malaysia either for a specified term or the term of his natural life.

> may issue an expulsion order requiring this person to leave Malaysia before 14 days.

> may at any time revoke a banishment or expulsion order.

2. Any banished or expelled person found entering or residing in Malaysia who commits an offence is liable to imprisonment depending on the term of banishment, expulsion or deportation, or to not more than 15 years imprisonment if previously convicted under the Act.

The Internal Security Act (ISA)

1. Was first implemented in Malaya by the British in 1948 to combat the armed insurgency of the Malayan Communist Party during the Malayan Emergency.

2. Allows for detention without trial or criminal charges under limited, legally defined circumstances.

3. Since its inception until 2005, a total of 10,662 people have been arrested under the ISA.

4. One of the biggest spate of arrests happened during Operasi Lalang in 1987 when 106 politicians, social activists and NGO leaders were detained.

5. A person may be held by the police for up to 60 days without trial for acts which allegedly threaten the security of the country. After the 60 days, the Home Ministry may release a detainee on restrictive orders, or order further detention without trial for a term of two years.

Emergency Proclamations

1. A proclamation of emergency is made when the public’s safety or economic livelihood or the peace of the country is under threat.

2. Since independence, four proclamations of emergency were issued in 1964 and 1969 for the whole of Malaysia, 1966 in Sarawak and 1977 in Kelantan.

3. The 1964 Proclamation of Emergency was made in response to Indonesia’s declaration of confrontation with Malaysia while the one in 1969 was made following the May 13 riots .

4. In 1971, a court ruled that the 1969 proclamation had superseded the 1964 one although it was never revoked.

5. Today, three proclamations of emergency are still in place.


 Another one missed in the list above is the review of the Police Act  in terms of freedom of speech and assembly:

Allowing greater freedom to assemble by reviewing Section 27 of the Police Act 1967 by taking into consideration Article 10 of the Federal Constitution which guarantees every citizen with the right to freedom of speech and assembly.

Below is commentary by Prof Shad Saleem:

The Prime Minister’s announcement on a number of changes to the country’s laws, including ending the Emergency, will have massive positive implications.

THE Prime Minister’s speech last night evoked the kind of hope and exhilaration I felt many decades ago on Aug 28, 1963, when I heard American civil rights leader Martin Luther King, Jr. deliver his “I have a dream” speech at the steps of Lincoln Memorial.

The Prime Minister pointed to a number of changes that he intends to bring to the country. Many of these proposals will have massive positive implications for the country’s legal system, its administration of justice and the sovereignty of law over personal discretion. He promised that:

> The emergency proclamations that are in operation will be presented to Parliament for annulment;

> The Internal Security Act will be repealed but replaced with two security laws framed under the Constitution’s anti-subversion provision of Article 149;

> The Restricted Residence Act and the Banishment Act will be brought to an end; and

> The much-criticised Printing Presses and Publications Act will be amended.

It will take some time and considerable research to fathom the full implications of the above pronouncements. Needless to say, the impact on the legal life of the community, the rights of the citizens, the powers of the Home Minister and the police will be monumental.

The rule of law will be strengthened and the days of the omnipotence of the Government will come to an end. Looking at the implications of the lifting of the Emergency, the following salient features of emergency laws must be noted:

Ordinary legal system eclipsed: Under Article 150, once a proclamation of emergency by the Yang di-Pertuan Agong is gazetted, the floodgates are lifted and legislative powers of Parliament are greatly broadened. Parliament can make laws that violate, suspend or bypass any constitutional provision except six items in Article 150(6A).

All fundamental rights except freedom of religion can be violated. The federal-state division of powers can be disturbed and state powers usurped.

Emergency laws do not require a two-thirds majority. Neither do they require the consent of the Conference of Rulers or the Yang di-Pertua Negeri of Sabah and Sarawak.

Judicial review on constitutional grounds is ousted because of Article 150(6).

An emergency law has no time limit and can continue as long as the emergency lasts.

Malaysia has been under such a state of emergency continuously since 1964. For all practical purposes, an emergency legal system eclipsed the ordinary legal system for the last 47 years.

The King’s power to make laws: As with the powers of Parliament, the powers of the federal executive are immensely enlarged during an emergency.

The Yang di-Pertuan Agong acquires plenary and parallel ordinance-making powers under Article 150(2B) as long as the two houses of Parliament are not sitting concurrently.

The executive’s power of ordinance-making is as large as Parliament’s power of legislation. The entire Constitution can be suspended except for six topics in Article 150(6A).

Since 1964, the Yang di-Pertuan Agong has promulgated nearly 92 emergency ordinances. Among these is the Emergency, Public Order and Prevention of Crime Ordinance, which is a favourite with the police and which results in more preventive detentions than even the Internal Security Act.

Executive power to give instructions: Under Article 150, the Federal Government acquires powers to give directions to the states in contradiction with the meticulous federal-state division of powers.

If the emergency proclamations are repealed, what effect will that have on the legal system?

Restoration of normal laws: If the two proclamations of national emergency in 1964 and 1969 are repealed, the country will return to the normal operation of the constitutional system.

The five or so emergency laws made by Parliament under the authority of these proclamations will cease to operate. Any detention under these laws will have to be terminated.

Emergency ordinances will end: As with the emergency laws enacted by Parliament, the 90 or so emergency ordinances promulgated by the Yang di-Pertuan Agong (and the hundreds of subsidiary laws made thereunder) will also cease operation.

However, the cessation of emergency laws is not immediate. Under Article 150(7), there is a grace period of six months during which the emergency laws may still continue to operate. Once the six months expire, the expiry of the laws is automatic and no individual repeal is necessary. However, no action (e.g. for damages) can be taken for anything validly done under previous laws.

Some may wonder whether the Yang di-Pertuan Agong, in his discretion, may refuse the Prime Minister’s advice to restore the rule of law and to lift the proclamations of emergencies?

In a long line of other cases, it has been held that emergency rule does not alter the position of the Yang di-Pertuan Agong as a constitutional monarch bound to act on advice.

The case of PP v Mohd Amin Mohd Razali (2000) altered the law slightly: it held that during the dissolution of Parliament, the Yang di-Pertuan Agong is not bound by the caretaker government’s advice on emergency matters.

Amin is, of course, not relevant to the Prime Minister’s speech last night because Parliament is not under dissolution and the Prime Minister’s advice is binding on the King.

Judicial review strengthened: The lifting of the Emergency will remove the eclipse of ordinary laws. The possibility of judicial review of executive and legislative measures will be enhanced. Many human rights will be restored.

The demise of hundreds of emergency laws, some conferring preventive detention powers and others excluding due process, will be a defining moment for Malaysian democracy.

However, the euphoria that is bound to be felt as a result of these wholesome developments must be tempered with caution.

New proclamations: The lifting of the 1964 and 1969 emergencies does not prevent the re-issuing of a new proclamation of emergency and the promulgation of new emergency Acts and ordinances, if circumstances so demand.

Subversion laws stay: Even if the Emergency is lifted, Parliament is still armed with anti-subversion powers under Article 149. New security laws under Article 149 have been suggested by the Prime Minister. Existing laws like the Dangerous Drugs Preventive Measures Act will not be affected by the lifting of the Emergency unless the Government sets about to apply the reformative paint brush to them as well.

Police Act remains: Controversial ordinary laws like the Police Act, the Official Secrets Act and the Universities & University Colleges Act will remain in the statute book though, of course, they will face pressure to accommodate the spirit of the times.

Some may, therefore, regard the lifting of the Emergency as merely a cosmetic measure because Articles 149 and 150 still arm the Government and Parliament with massive power to suspend constitutional guarantees.

Such a perspective is unduly cynical. It amounts to an all-or-nothing attitude. Whatever reforms are adopted and implemented must be welcomed. They may be harbingers of new things to come. They will certainly set a new mood and may be the catalyst and impetus for further improvements to the human rights scene.

A government receptive to the lifting of the Emergency cannot be indifferent to improving the situation of laws under Article 149.

All in all, one must applaud the Prime Minister’s courage, his willingness to listen to the voice of the people, his receptiveness to the felt necessities of the times, and his exhilarating agenda for reform.

The Attorney-General’s office also deserves congratulations for advising the Prime Minister on the incongruence between the rule of law and the state of emergency lasting 47 years.

So, let Sept 16, 2011 go down in our history as “a joyous daybreak” to end the long night of the Emergency.

> Datuk Shad Saleem Faruqi is Emeritus Professor of Law at UiTM and Visiting Professor at USM.


Vernacular schools not neglected?

September 16th, 2011
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I’m not sure what the minister was trying to prove, but I’m sure not many people are buying into this statement. Just look at budget and allocation in past Malaysian Plans, look at the school conditions, look at the piecemeal amounts dumped at suitable times, and then you tell me there’s no neglect. Need not go far, even in this article, the government is giving RM1 million for the hall. Why not pay for the whole thing?  Because its sekolah bantuan modal? On private land? The same old excuse. Why never thought of changing those hindering laws all this while instead of making a convenient excuse? I would certain agree that adequate attention had not been given to vernacular schools.

We only have 523 schools, yet had built 600 Tamil schools? More schools had closed down since Independence, and in fact, most of those schools were build by the estate/plantation owners. On when schools are terminally unusable or being relocated, we get to rebuild the school.


The Government has never neglected the development of Chinese and Tamil schools, Tan Sri Muhyiddin Yassin said.

The Deputy Prime Minister pointed out that to date, the Government has built more than 1,200 Chinese schools and 600 Tamil schools nationwide.

“There are certain quarters who allege that the Government has not given adequate attention to these types of schools.

“This is incorrect as the Government has a ministry which is responsible to develop and maintain such schools,” he said in his speech during the ground-breaking ceremony of Chung Hwa High School multipurpose activity centre here yesterday.

During the ceremony, Muhyiddin, who is also Education Minister, also announced an allocation of RM1mil from the Government towards the project, which will cost RM10mil.


ex-MIED CEO Chitrakala freed

September 13th, 2011
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This is an interesting case indeed! After the case was initiated last year (around May), we get this result. The accused has provided proof that the money was returned (among others), and the prosecution says go no other evidence to offer. So, case closed, accused free.

What do you make of it?

For me, it seems that (i) the money was taken wrongfully, and returning it deemed the case irrelevant, (ii) some sort of deal was arranged with the parties involved and all this was just a misunderstanding or attempt to get back at certain quarters, or (iii) the prosecution had a very weak case and returning the money broke their case.

Whatever it is, seems very weird.

Former chief executive officer of Maju Institute for Education Development (MIED), P. Chithirakala, has been acquitted and discharged of three charges of cheating involving RM4mil.

Sessions Judge Che Mohamad Zulkifly Jusoh reached the decision after allowing DPP Kevin Morais’ application to withdraw the case against Chithirakala, 40.

Morais said the accused had submitted three letters of representation to the Attorney-General stating several material facts.

“Among the facts was that the accused had returned the RM4mil, which formed the basis of the three charges against her, to MIED Capital Sdn Bhd.

“After considering the representation, the Attorney-General agreed to withdraw all charges against the accused,” he added.

“In relation to this, the prosecution offers no evidence against the accused on the charges,” he said.

On May 11 last year, Chithirakala pleaded not guilty to cheating former MIC secretary-general Tan Sri M.Mahalingam , who was a director and signatory of MIED Sdn Bhd (the educational arm of MIC), by deceiving him into signing two cheques worth RM4 million in total. BERNAMA.