Wednesday, February 27, 2013

Pakatan targets RM49.5b yearly savings to fund programmes

Pakatan targets RM49.5b yearly savings to fund programmes

UPDATED @ 04:01:20 PM 27-02-2013
By Boo Su-Lyn
February 27, 2013
Malaysian Insider 
Rafizi said PR’s economic reforms would be funded entirely by projected operating expenditure savings. — Picture by Choo Choy MayPETALING JAYA, Feb 27 ― Pakatan Rakyat (PR) aims to save about RM49.5 billion annually on federal government procurements and projects in order to finance economic programmes costing RM45.8 billion annually, should it win Election 2013.
PKR strategy director Rafizi Ramli told reporters today that the opposition pact would emulate the Selangor PR government that saved 24 per cent on road projects from January to September 2012.
“We’ll save RM49.5 billion, which is 24 per cent of the (RM206.4 billion) expenditure,” said Rafizi, referring to the cost of existing government procurements and projects this year.
Rafizi pointed out that PR’s economic agenda would cost RM45.8 billion, comprising the scrapping of toll payments, the reduction of excise duties, a national housing scheme, teachers’ special allowances, dismantling the National Higher Education Fund Corporation (PTPTN), and 20 per cent oil royalties
Other initiatives include the Caruman Wanita Nasional scheme, bonuses for senior citizens, a fund for minimum wage, People’s Pioneer Scheme to train school-leavers, 20 per cent contribution to the Armed Forces Fund board (LTAT), veterans’ dividends, an increase of buses in the Klang Valley, free wards at government hospitals, and an increase in welfare aid.
PR unveiled its election manifesto on Monday, promising a complete revamp of the country’s economic approach with the aim of ensuring every Malaysian household draws a minimum monthly income of RM4,000 by the end of its first term.
Rafizi also said that PR would acquire the toll concessionaires in stages, starting with PLUS that would cost RM5.5 billion this year.
He noted that it would cost RM6.9 billion this year to acquire PLUS expressways, but this would bring savings of RM1.4 billion from cutting annual compensation and dividends to the firm, and from an increase in domestic demand as a result of scrapped toll payments, resulting in a total cost of RM5.5 billion this year.
Rafizi also said it would cost RM6 billion annually to provide free tertiary education and to eliminate the National Higher Education Fund Corporation (PTPTN).
The PKR politician added that PR would reduce private vehicle excise duties by 20 per cent annually for five years starting this year, which would be offset by selling Approved Permits (APs).
“By 2018, when the economy has developed, the loss of RM7 billion (from excise duties) will be offset by economic growth,” said Rafizi.
He also pointed out that the Auditor-General’s 2008 report stated that corruption had cost the country RM28 billion.
“Transparency-International said that RM40 billion can be saved from open tender. So our estimation of RM49.5 billion is not that far off,” said Rafizi.
He also noted that a PR government would collect additional taxes totalling RM4 billion annually, as a result of 7 per cent annual economic growth.
Rafizi said that PR would also reprioritise expenditure by reducing the Prime Minister’s Office’s budget, for example.
“Now the Prime Minister’s Office gets RM14 billion every year, which is almost five per cent. We’ll change this,” he said.
He stressed that PR would reduce fuel prices not by increasing government subsidies, but by restructuring the subsidies to independent power producers (IPPs).
Rafizi pointed out that PR would implement a RM1,100 minimum wage by providing government subsidies of RM2 billion annually to help out employers.
“Only certain companies of certain profitability can enter this scheme, and they must automate and replace foreign workers. After two years, they graduate (from this scheme),” he said.
Rafizi said that the Barisan Nasional (BN) approach of implementing the RM900 minimum wage this year had angered small-medium industries as the federal government did not help the companies cope through subsidies.

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