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Thursday, June 15, 2017

Are bonuses the latest political tool?

Economist says culture of rewarding people before or during elections has been around, but this is a new version of it.
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PETALING JAYA: Could providing bonuses be a new culture of rewarding people as the general election draws closer, or is it solely performance-based as declared?
Shah Alam MP Khalid Samad said bonuses should certainly be based on performance, not used for political mileage.
“I think in the state of Selangor, if I’m not mistaken, it is tied to performance where the government has managed to make some savings and improved efficiency in certain services,” he told FMT.
Khalid said he believed the Penang government had applied the same principle as Selangor, but he was unsure about the other states.
“If it is being done purely for political purposes, then obviously there is a fundamental error in that approach.”
Economist Dr Barjoyai Bardai said bonuses could be tied to impending elections. It could also be seen as a sign of generosity and performance.
“I think the culture of rewarding people during an election has been around, but this is a new version of it,” Bardai told FMT.
He said if the incentive was in the form of sponsorship for higher education for the employees or children, it would be more sustainable in the long run.
“Also, retraining is the name of the game today. Because we are moving into the fourth revolution, everybody needs to be retrained. That would be a better incentive for the employees.”
Bardai said in general economic terms, bonuses were good as they promoted spending, boosting the gross domestic product (GDP) rate for the short term.
But, in the long run, if the spending was not productive and did not generate income for the spender, he said it would result in the economy being dragged down.
He said the economy was still at a crossroads. There is doubt over whether the worst is over, but personally, he thinks that “we have not seen the worst yet”.
Universiti Sains Malaysia’s political sociologist Dr Sivamurugan Pandian had similar views as Bardai, but added that civil servants’ expectations would grow higher.
He said the state governments should be mindful of this and not get trapped by these expectations.
“Who doesn’t want a bonus? Well, if the state government is confident the payments will not affect the state’s economy, then it’s fine, if they have enough savings and funds.
“In the end, it’s going be a populist action but they must make sure they will be able to sustain it. If they fail to sustain it, this will affect the state government,” he told FMT.
Sivamurugan said the government could not deny that bonuses would seem like election goodies to some, even if it provided assistance to people during festive occasions.
“So they have to justify that and convince people that they are genuine in giving it because they have sufficient funds, and not otherwise.”
The Selangor government has declared that it will hand out two months’ Hari Raya bonus, while Penang will be giving a RM1,000 bonus or 0.75% of their monthly salary, depending on which is higher.
Other states that have agreed to hand out bonuses this year include Johor and Kedah, which will be giving out RM1,000, and Kelantan, Perak and Negeri Sembilan, which will be giving out RM500.
Prime Minister Najib Abdul Razak recently announced that civil servants would receive a special financial assistance of RM500 ahead of the Hari Raya Aidilfitri celebration while pensioners would get RM250.
The special aid is expected to benefit 1.6 million civil servants and 775,000 pensioners.
Najib also said each Felda settler family would get RM500 to assist them in celebrating Aidilfitri. -FMT

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