Klang MP Charles Santiago today launched the "Rental Relief Fund" online petition, urging the government to provide rental subsidies for local businesses which have been badly impacted by the Covid-19 pandemic.
The DAP lawmaker proposed the idea last December but received no response from Finance Minister Tengku Zafrul Abdul Aziz.
Speaking at an online press conference this morning, Charles said the government should allocate up to RM1.5 billion to ease the burden of the small and medium enterprises (SMEs).
According to him, the fund should provide three measures:
- Give a special grant of 80 percent rental subsidy to SMEs that experience 30 percent revenue drop, capped at RM8,000 per month, for six months.
- Freeze rental increase at all commercial premises until December 2021.
- Suspend tenant evictions until December 2021.
Charles also suggested the Finance Ministry set up a rental relief fund division and collaborate with local councils to handle application processing, and to channel the funds to premise owners or landlords.
The press conference was also attended by more than 14 representatives from different industries, such as the Malaysian Medical Association (MMA), Malaysian Hairdressers Association (MHA), coffee shop associations, Malaysian Indian Restaurant Owners Association, among others.
They said rental, utilities, and other fixed costs which made up 20 to 30 percent of operating costs, are the major factor that has resulted in SMEs experiencing a tight cash flow.
Almost all of the representatives said the situation became harder during MCO 2.0 which was implemented from Jan 13 until the beginning of March.
Malaysian Pharmaceutical Society president Amrahi Buang revealed that there were about 200 private clinics that have shut their businesses since the movement control order (MCO) took place last year.
“Community pharmacies are also facing the same fate now.
“Although we are one of the essential services, for the independent pharmacies which operate within the community, they have the difficulties to pay the rent too.
“It’s hard for us during MCO and the situation becomes worse during MCO 2.0. Thus we hope the finance minister will consider our appeal and set up the rental relief fund immediately.
Meanwhile, Malaysia Singapore Coffee Shop Proprietors Association chairperson Ho Su Mong pointed out that about 600 coffee shops closed down during MCO 2.0.
“We sincerely hope and urge our government, especially the finance minister, to provide this rental relief fund so that our members can stay afloat.
“We have been in the industry for more than a century, some of us are three generations old."
Maintain purchasing power and quality of life
Economist Nungsari Ahmad Radhi said the fund should be part of the economic recovery plan of the government.
He said it could not only protect SMEs from closure and save jobs but also maintain the purchasing power and quality of life in the community.
This is because those who are severely affected are mainly the community-based businesses, added Nungsari.
“According to the recent data from DOSM (Statistics Department), in January 2021, the wholesale and retail sector is contracting 2.7 percent and that is not a good signal.
“That means our domestic demand is still contracting and we have to do something so it won't get worse," said Nungsari, who is the former chairperson of the Malaysian Aviation Commission (Mavcom) and Khazanah Research Institute.
He reminded that about 60 percent of Malaysia's economy is domestic driven, so if the local businesses die off, the ability of economic recovery would not be there.
“Things will not normalise (just because the MCO is lifted), there are still people who are unemployed, and the businesses which shut down won’t come back just like that," Nungsari said.
For the record, more than 30,000 SMEs have ceased operations due to MCO since last March.
Charles noted that he had a long discussion with Zafrul last December on the rental relief fund proposal.
“He knew this is important, and we also looked at the experiences from Singapore, Hong Kong and the UK on how similar plans have been rolled out.
“I think what is required now is political will, whether the government wants to do it or not,” said Charles, adding that the RM1.5 billion budget is possible for the government to spare.
When asked about the deadline for the government to respond, Amrahi said it was supposed to be done at the beginning of the year, before the government unveiled the RM15 billion aid package "Permai" on Jan 18.
The package aimed to help people cope with the MCO 2.0.
“Like what Charles has mentioned, he had presented to Zafrul and since there was no response, we launched this online petition as a follow up action,” said Amrahi. - Mkini
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