Press statement by Kua Kia Soong, SUARAM Adviser 9 Sept 2019

The government is contemplating a new scheme whereby appointments in the public service will no longer be made under the permanent and pension schemes but will be replaced with a contractual scheme. This was announced by Public Service Department director-general Borhan Dolah. He said this is aimed at reducing the burden of pensions which is now reaching RM28 billion. He said existing civil servants might be given the option to switch to the new contractual scheme.

However, soon after that the prime minister said no decision has been reached yet on the matter, and it has not been discussed by the cabinet. Will we be witnessing another of the new government’s familiar flip flops?

If the government is so keen to cut the burdensome pension bill, surely, they should start by doing away with the multiple pensions that politicians get and restricting them to just one pension when they retire from politics? As it is, our grabby politicians who monopolise federal and state parliaments, who double up as Chief ministers at the state level and still want to be federal parliamentarians, who move from state to state to try their political fortunes, etc. can claim multiple pensions from these multiple posts. Thus, if the government is keen to cut down on the national debt, shouldn’t they start by restricting the right of politicians to just one pension when they retire?

Bloated civil service – the price of populism

The prime minister has pointed out that the government’s pension bill has also been burdened by the previous administration’s 25 per cent salary increment for civil servants, which he said was done without considering the government’s financial strength.

The fact is, Malaysia’s bloated civil service is the price we are paying for just that sort of unbridled populism all these years since the new Economic Policy in 1971 and especially just before general elections. Najib Razak wasn’t the only Prime Minister who indulged in this form of populism to fish for civil servants’ votes. It goes back all the way to 1971 when the civil service began to be expanded as a populist move to implement the “Malay Agenda”.

After the launch of the New Economic Policy in 1971, the expanding state sector has provided civil servants not only with opportunities for attractive salaries, ‘perks’, but also scope for private accumulation in the many business opportunities open to bumiputras. Thus, the proportion of Malays in the administrative and managerial occupations rose from 24 per cent in 1970 to 32 per cent in 1980. According to the 1980 census, more than 80% of all government executive officers were Malays while 96% of Felda settlers were Malay.

Malaysia’s bureaucracy is one of the biggest in the world, with 1.7 million civil servants to a population of 32 million, a ratio of 5.3% compared with Singapore’s ratio of 1.5% civil servants to total population; Hong Kong’s 2.3% and Taiwan’s ratio of 2.3%. We are spending more than RM41 billion a year to upkeep our civil servants.

While it is the growing trend of many countries to reduce their civil service, Malaysia’s Prime Minister’s Department in particular, has done the opposite. It has more than doubled its number of civil servants from 21,000 to 43,554. To date, there are ten “Ministers in the Prime Minister’s Department” alone, on top of other important agencies or governmental bodies that fall within the purview of the Prime Minister’s Department. The new PH government has even invented a new post, “Special Advisers to the Ministers” for their unemployed politicians!

Naked civil servants

The original idea behind giving civil and armed service personnel pensions was so that they give impartial service to the nation and the pension would ensure that they maintain that integrity after they retire. Now, we see the ‘revolving door’ syndrome only too often. The offer of Chair of Prasarana for the previous IGP so soon after he retired is a culture of ‘revolving doors’ between the civil and armed services and the corporate world. This practice is inimical to good governance and breeds corruption and non-accountability because of kickbacks and favours rendered by civil and armed service personnel in the award of contracts. There are examples aplenty especially in the energy and defence ministries in my two books, ‘Questioning Arms Spending in Malaysia’ and ‘Damned Dams and Noxious Nukes’.

And is more than 95% Malay dominance of the civil service not sufficient ‘affirmative action’?

The gross disparity in the ethnic make-up of the civil service up to 31 March 2011 was revealed in a reply to a parliamentary question in August 2011. The second largest ethnic group in the country, namely, the Chinese community made up less than two percent of the Malaysian government service employees. There is a gross under-representation of the non-Malay communities and the East Malaysian indigenous communities in the civil service at all levels.

The large Malay representation of a bloated administration serves the populist objective of the Malay ruling class in charge of the state since it creates race-based benefits to be given out to the Malays through the generous benefit and welfare and economic programs of the Government. These include government medical and health facilities for government servants; favored treatment including scholarships, admissions into higher educational programs; pension schemes, discounted travel fares for retired administration employees; discounted hotel charges in government run hotels and so on.

Recently, World Bank lead public sector specialist Rajni Bajpai noted in her report:

“There is a strong perception … that recruitment of the civil service is not fair and neutral (with) Malaysia scoring very poorly on the indicators for impartiality in the government…It’s the lowest ranked, even below the region and way below the OECD,” she said, adding that the government in its election manifesto had suggested setting up an Equal Opportunities Commission to tackle discriminatory practices in both the public and private sector.

A striking case of racial discrimination is seen in the total absence of any non-Bumiputera Vice Chancellors in any of the public sector universities in the country when this was not the case in the early years of Independence. This surely has consequences not only for justice and civil rights of non-Malays but also for the pursuit of meritocracy in the Malaysian civil service.

The sharp decline in ethnic composition of the non-Malays in the Malaysian civil service perhaps reflects the World Bank report’s conclusion that “… recruitment of the civil service is not fair and neutral (with) Malaysia scoring very poorly on the indicators for impartiality in the government”. This surely has consequences for “accountability, impartiality and the openness of its public sector”.

Thus, the reform agenda before the new PH government is not just the question of “pensions or contracts” for the civil service but a wider question of confronting and solving these issues, namely,

(i)                  the hugely oversized bureaucracy and a drain on taxpayers’ contributions;

(ii)                that composition and recruitment into the civil service is neither fair, neutral nor merit-based, and

(iii)               that our civil servants, including director generals are underperforming? 

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