opinion : Praba Ganesan

Paying for the Pakatan manifesto

Praba Ganesan

MARCH 15 — First, congratulations to Pakatan Harapan, for releasing their election manifesto. Right, wrong or mixed signals, you are willing to put your cards down and allow the rakyat to peruse the coalition’s ambition. And pass judgement.

It’s not advantageous to be evaluated, and which is why traditionally manifestos are released late into campaigns and turn out to be window dressing only.

It is advantageous for the voter, to be cognisant of what any side wants to do if offered the chance to govern.

As such, democracy benefits. One step to informed choice.

Imperative to note, there are a number of people on both sides of the divide who believe democracy is too important to be left merely in the hands of voters; and therefore it is better to keep everyone in the dark and surprise people in a warped strategy, for it is to them about gamesmanship.

What they mean when they say democracy is they mean power. They are different things. Democracy empowers people, and power can empower people but not necessarily does that, in fact at times it does the opposite.

In this vein, I’d encourage Barisan Nasional (BN) to present theirs, so they are above the pettiness of fearing public admonishment.

So what was in Pakatan’s manifesto?

Today I will look at the fiscal component, therefore policy issues like decentralisation to states, the quiet on local elections and wholesale scrapping of laws will get their day next week.

Build the nation and fulfil hope

There are bright sparks in it, replicating Selangor’s private-public partnership to build homes which the burgeoning middle-class’ youth can purchase, for instance. There is boldness in increasing funds sent to economically depressed Borneo.

Then it hits a hard titanium solidified wall.

It has a gaping hole in how to manage the deficit it certainly creates — for it spends more than it earns. It suggests hypocrisy because Pakatan over the years accused BN of overspending, upping the national debt. Now, they’d do the same.

The biggest cost will come from abandoning the GST, and readopting subsidies for a range of things, not the least petrol, which will radically spike up government expenditure.

Transferring some oil revenue to a long term development fund on top of 20 per cent royalty funnelled to Sabah and Sarawak; rechannelling eventually 50 per cent of tax revenue collected in Borneo to the respective state governments rather than federal; postponing student loan servicing and government paying up to RM250 per worker to share the burden of lifting to meet the RM1,500 minimum wage (potentially adding up to billions of ringgit annually); and targeting to increase spending on healthcare from two per cent to seven per cent of the GDP regardless of savings from transparent procurements, will lead to a bloated expenditure total.

If the only substantial trade-off is the decimation of the prime minister’s department from RM18 billion to RM7 billion per annum in expenditure, then it is worrying. The other caveat is there will be impending savings from the corruption and leakages crackdown.

Since 85 per cent of the 2018 Budget is operating expenditure, halving the PM’s department would translate to letting staff go. If they only redistribute staff from that department to other ministries, they are sustaining the expenditure, and therefore there will be no saving from halving the PM’s department.

For Pakatan denies any intention to downsize government.

Which leaves us with savings from less corruption and reduction of leakages, and the assumed belief that with better government the economy marches relentlessly.

In this Pakatan utopia, Malaysia thrives from GLCs returning higher profits to Khazanah rather than being the personal piggy bank of unscrupulous politicians cum board members; SMEs facilitated by a pro-business regulatory structure goes great guns and propels the economy forward while rewarding employees; and the large conglomerates lead the charge abroad on their competency locally with Malaysians in suits succeeding both at home and abroad.

That in a thundering economy, government income is secure.

In theory, yes, but it takes time. In the short run, it’s new expenses.

False narrative

What irks me is the idea great change in a country collapsing from the weight of incompetence and indulgence can be rectified seamlessly with the least amount of volatility, displacement, creative destruction, structural objections and novice errors by the new lot in.

The clear lack of trade-offs can be explained in the analogy of two suitors for a fair maiden. She has been wronged and deprived by the long fiancé and now the newcomer would like to make things better by throwing the bait of everything wonderful from the nasty fiancé added with all the amazing things the new suitor wishes to advance.

It is flawed — apologies for the misdirection — to assume two groups are offering different things, and we as the fair maiden, choose.

It is not the case. It is a red herring analogy.

For they — the two competitors — are promising to give better to the same population from the same pot. The government’s wallet is finite, and even if better governments will raise the pot so will weak governments reduce it.

It is about managing the finite amount.

Acting to compete with each other on how much can be promised is negligent of what is possible.

It is also about what is collected. From companies, economic activities, employees and general taxes. This was not covered as much in the manifesto.

Fair to say, the government of the day has not been strong in this, for the deficit has gone up for decades, it is for Pakatan to exhibit its mantle in this matter to edge them.

A badly run nation, if that is Pakatan’s contention, requires bitter pills in the short term.

It was Pakatan’s role to present tough choices and explain their rationale for them.

Not seduce the nation with more goodies, and slink away to benefit from the votes to follow.

It assumes too few Malaysians are aware of the concept of a limited wallet.

Life is dedicated to teach people they must make do financially. Maybe not yacht owners, but regular people are aware. To assume they will abdicate this knowledge and commit themselves to the notion all parties or coalitions can deliver as much as they wish to promise with no restraint because governments are infallible, is foolhardy.

This is where, fiscally, even before BN issue their latest manifesto, Pakatan has already failed to defeat in the campur-tolak component when compared to all previous BN manifestos. 

It is a collection of cop outs, when seen in totality.

* This is the personal opinion of the columnist.