Pakatan’s Zombienomics

Dato’ Eric See-To

Increasing the minimum wage 50% from the current RM1,000 to RM1,500 and eventually to RM1,800 per month is one of the main items in Pakatan Harapan’s alternative budget 2018.

Pakatan had slammed the Federal Govt for not further increasing minimum wage for 2018 despite the fact that it was the federal government who first introduced the minimum wage in 2012 and then increased it by RM100 in 2016.

While the Federal Govt is committed to increasing the minimum wage in order to lift the lowest income group and reduce the income gap, the govt understands that this must be done on a gradual basis in order not to throw our economy into chaos.

In the meantime, the Federal Govt provides other assistance to Malaysians in the lower income group such as BR1M and welfare department monthly payments.

Why I said that Pakatan preaches populist but ultimately, Zombie-nomics is this.

Pakatan says that only 360,000 Malaysians are paid minimum wage and that their govt will partly subsidize bosses for the salary by paying RM2.5 billion per year.

However, what Pakatan does not realize is that under our local laws and international laws and treaties, Malaysia cannot discriminate between local and foreign workers in terms of salary therefore, the minimum wage policy also applies to foreign workers.

Assuming that only half of the 3 million legal foreign workers in Malaysia is at the minimum wage then, Pakatan will also have to partly fund the salary increases of 1.5 million legal foreign workers which pushes up the total yearly bill to the gov to be f RM13 billion a year – or almost double of what 2018 BR1M is.


Even if Pakatan funds half the RM500 increases, the employers will still have to come up with RM250 per employee per month. So, a mamak shop of 20 workers will be looking at paying RM5,000 extra per month.

Somebody will have to bear this sudden 50% increase in wages.

All these cost increases in one go will definitely feed inflation as the employers pass on the cost to the consumers – and this will be in all sectors across all product ranges.

Our inflation will sky-rocket while our govt is faced with a severe burden every year – surely a recipe to drive Malaysia to chaos.

And there you have it. Yet another example of Pakatan simply talking without thinking of the wider implications of what their promises are.

Source: Eric See-To



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