What about jobs, Mr Finance Minister?

Last week Prime Minister Muhyiddin Yassin unveiled the second stimulus package known as package "Prihatin" to tackle the Covid-19 pandemic.

The hype for this package has been enormous. A news portal, running the story under the anonymous byline “A Special Correspondent” and citing a source, described the package as “almost double that of Singapore”.

When it was finally unveiled, the so-called RM250 billion package was touted as ensuring that "no one will be left behind" in this current Covid-19 crisis.

At the centre of the package is, of course, the newly minted finance minister, former CEO of a big local bank, Tengku Zafrul Aziz (above). A day before the package was unveiled, he tweeted a photo of him with ministry officials who worked with him on the package. As the finance minister, he would no doubt be the key person in coming up with the stimulus package.

A week has since passed. While many lauded the one-off payments and the bank moratorium, criticisms have been levelled towards the package for not being enough for the country to sail through troubled economic waters of this current pandemic.

The biggest criticisms would be the lack of sufficient support for SMEs and measures to deal with the inevitable unemployment that will take place in the coming weeks and months.

In fact, for certain sectors such as aviation and tourism, many employees have already been laid off or forced to take unpaid leave. Many more will soon follow as SMEs reel from what would be four weeks of the movement control order (MCO).

According to the Prihatin announcement, the government will introduce a wage subsidy program of RM600 a month for three months for employers with a 50% drop in business since Jan 1 for workers with a salary of below RM4,000. The government will allocate RM5.9 billion for this programme.

Many economists have commented that the wage subsidy programme introduced under this stimulus package is too small and have called for a more comprehensive programme.

Former economic advisor to Dr Mahathir Mohamad, Muhammed Abdul Khalid, had commented that the government’s allocation of RM5.9 billion of the RM22 billion direct fiscal injection is much lower than other countries such as New Zealand, South Korea and Canda. Singapore, he says, allocated 81 percent of its fiscal injection for their wage subsidy programme.

This sentiment is also reflected in the reactions of the industries. On the SME side, the government’s initiatives focused on loans and credits which were not of much help to SMEs. Indeed, why would these businesses take loans to pay of salaries if there is no guarantee that these loans can even be paid off?

The government should not be approaching this crisis as a bank would by offering loans.

Thus it would appear that the government has not given sufficient attention to the one key area which has been the focus of all other Covid-19 stimulus packages the world over has focused on - saving jobs.

Now the government is scrambling. Cabinet members have had several meetings with industry leaders and representatives on the issue of SMEs.

On Thursday, it was announced that the government has set up a Special Cabinet Committee to come up with necessary measures to safeguard the country’s economy and labour market affected by the Covid-19 pandemic.

This committee, which will have three meetings according to the statement, will also look for measures to sustain the SMEs during the MCO period and address the displacement of the labour force among Malaysian workers.

Frankly, these matters which should have already been looked at and been part of the economic stimulus package announced last Friday.

This raises several questions. Why was the displacement of labour not considered before in a more comprehensive manner? Did the finance minister not realise that the priority for our economy is to save jobs?

From his interview in Astro Awani’s "Consider This" programme last week, the finance minister seems to think that the Prihatin package is enough for the next 3-6 months. From the response of economists and industry representatives though, it is clearly far from sufficient.

Extraordinary times require extraordinary measures. Yet, extraordinary measures require empathy and feedback from those on the ground. It requires those with feet firmly on the ground to understand that for something to be workable, they must go beyond abstract concepts. If cabinet ministers are not able to grasp these realities, any measure taken will not be effective.

At least the government has now realised that the much-touted package falls short of what is truly needed. It is merely a Band-Aid for a chronic illness, as Muhammed Abdul Khalid puts it. More is needed and it is hoped that the government will introduce another package in the near future.

But for many who have already lost their jobs over the past few weeks, it may already be too late. 

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SYAHREDZAN JOHAN is a civil liberties lawyer and political secretary to Iskandar Puteri MP Lim Kit Siang. - Mkini