THINK! UMNO SPENT BILLIONS & BILLIONS ON AID – BUT HOW COME YOU’RE STILL POOR: SAIFUDDIN NASUTION ASKS ORDINARY MALAYS – EVEN AS HE REVEALS U.N. STUDY SHOWS IMPACT ON POVERTY REDUCTION WAS ‘ZERO’

ZERO – that is the return from the RM24 billion Barisan Nasional spent in 2016 on social assistance programmes, ranging from BR1M to school meals, said Saifuddin Nasution Ismail.

The domestic trade and consumer affairs minister said this is due to leakages in the distribution system, which led to the undeserving receiving aid.

Another reason is because three out of 10 eligible families either did not know about the programmes or were excluded from the registration system, he said.

He said such leakages in the country’s extensive aid programmes are why the Pakatan Harapan administration puts a premium on plugging them, so that aid truly benefits the needy.

And, this is the philosophy behind the targeted fuel subsidy programme for the B40 group, which is expected to be rolled out next month.

“The net impact of our social protection programmes was studied by a United Nations economist named Dr Amjad. How we spent the aid was compared to how Ireland and Finland dispensed a similar amount of aid,” Saifuddin said during a talk on the cost of living at the Malaysian Industrial Development Finance Tower in Kuala Lumpur yesterday.

“Suffice to say, the social impact that Ireland and Finland had on their aid was better than Malaysia. The (BN) government gave out RM24 billion through 113 agencies, and the net impact on poverty reduction was zero,” said the National Council on Cost of Living (NACCOL) member.

He gave examples of how aid was improperly distributed, going to both the poor and rich.

One litre packs of subsidised cooking oil were smuggled overseas to Thailand, or used by high-end restaurants, he said.

Malaysia uses about 1.4 billion litres of petrol a month, one of the highest rates in the world, because of the country’s limited public transport system, says the domestic trade and consumer affairs minister. – The Malaysian Insight file pic, April 4, 2019.

Another was the subsidies for RON95 petrol.

“Malaysia uses about 1.4 billion litres of petrol a month, one of the highest rates in the world, because our public transport system is limited,” said Saifuddin.

“Of the total amount of fuel consumed, about 90% was RON95,” he said, referring to the type of petrol capped at RM2.20 per litre with the use of subsidies during former prime minister Najib Razak’s era.

The amount of diesel used was only 550,000 litres, and the rest was RON97 petrol, which is not subsidised and whose price reflects the world market’s.

“This means that people driving (BMW) 5 series and 7 series were using RON95,” he said, eliciting chuckles from audience members, many of whom wore pinstripe suits and pearl necklaces.

Once the targeted fuel subsidy system is well-implemented and the government reduces the amount it pays for blanket subsidies, the number of recipients will be expanded to include the M40 group.

In the medium term, Saifuddin said his ministry is completing a study on Malaysia’s production and supply chain for food and common household items.

This will help the government craft policies that address the supply chain’s cost factors, which determine the prices that consumers pay, he said.

He added that the ministry is looking at e-commerce platforms, which could be used to reduce cost factors.

Another focus for NACCOL is to slash the food import bill and increase domestic food production.

“When I was in the opposition before 2018, the food import bill was around RM36 billion a year. It has now shot up to RM60 billion a year, and this is not sustainable,” said Saifuddin, adding that buying food overseas means that prices are affected by currency fluctuations.

THE MALAYSIAN INSIGHT