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Wednesday, July 12, 2017

Austerity without priorities bad, says ex-finance ministry sec-gen

Former finance secretary-general Mohd Sheriff Kassim says cuts in Budget 2017 run risk of crippling public universities and hurting our future in terms of health.

PETALING JAYA: A former senior finance ministry official has called for the government to review its austerity measures and not apply it across the board, as it will have a negative impact on two important sectors, education and health.
While praising measures taken by the current finance ministry secretary-general to meet the budget objective of bringing down the federal deficit to 3% of the the GDP, former finance ministry secretary-general Mohd Sheriff Kassim said he is concerned the cuts will be counterproductive.
“Austerity is a good virtue but if it is applied across the board and carried too far without considering the priorities, there is a big risk that the expenditure cuts will be counterproductive.
“This is more so, if the cuts cripple our educational institutions and research capabilities and demoralise the university staff and professors.
“Similarly, health is also a crucial investment for our future,” Sheriff said.
He proposed for the government to come up with alternative sources of funding for these two sectors if a bigger budget allocation is not possible.
Sheriff, who is also a founding member of the Group of 25 eminent Malays comprising former civil servants and diplomats, lamented the situation in public universities following major cuts in its budget allocation over the past two years.
“I have been told by friends that university budgets have been slashed quite heavily to the extent that their research projects, especially those involving partnerships with foreign universities and research institutions have to be aborted.
“This is due to local universities not having enough allocations to pay their share of the costs like hiring of contract research staff or paying the air fare of the foreign professors involved in the project,” he said.
The budget allocation under the higher education specific to public university expenditure fell by 19.23% for 2017 compared with 2016, that is a drop of RM1.46 billion, from RM7.57 billion (2016) to RM6.12 billion (2017).
The impact is further compounded when one considers the 2016 allocation was already a major drop of 16.5% from 2015, when the allocation for public universities stood at RM8.97 billion.
“University medical schools and teaching hospitals complain of inadequate funds to buy the equipment and consumables used in laboratories and science experiments.”
Sheriff also spoke about how all government departments are told that any vacancy can only be filled with prior JPA clearance, and it is often the case that the request is turned down.
On that note, the former Khazanah Nasional managing director blamed the overall budget cuts on the biggest item in the government’s operating expenditure budget, that is salaries and pensions of government employees.
“Until something is done to control the size of the government and it’s over-grown civil service, the budget will always have limited room for other expenditures.
Last February, Second Finance Minister Johari Abdul Ghani was reported to have said that the bloated civil service of 1.6 million has caused government expenditure to rise yearly.
“We have about 1.6 million civil servants, which is the world’s largest proportion of civil service.
“In 2003, the pay of public servants totalled RM22 billion, but it increased to RM74 billion by 2016. In 2003, the pension of civil servants was RM5.9 billion, and in 2016 the amount soared to RM19 billion,” Johari was quoted as saying by the Borneo Post. -FMT

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