30pct bumi equity rule needs impact assessment, not blind defence

 

YOURSAY | 'Bumiputera advancement should mean better education, useful skills and greater economic security for ordinary families.'

No study shows 30pct equity rule helps bumiputera, says ex-govt agency chief

Knucklehead2: If a policy has been around for decades, surely there should be data showing whether it works. Where are the impact studies, measurable outcomes and accountability?

At what point do we stop defending policies and start asking whether they are achieving their intended purpose for bumiputera?

Real empowerment is about education, skills, entrepreneurship and wealth creation, not simply allocating shares on paper while others receive the financial benefits.

Exile: The debate over the 30 percent bumiputera equity rule should lead to a larger question: are our policies developing people's capabilities, or merely preserving targets whose effectiveness has not been adequately evaluated?

Bumiputera advancement should mean better education, useful skills and greater economic security for ordinary families.

The same scrutiny should apply to education. When parents feel compelled to pay for private tuition to help children cope with school, it raises questions about the effectiveness of the public system.

When examination results are influenced partly by what families can afford, claims of meritocracy can overlook differences in opportunity.

We should also question a system that treats examination performance as the main measure of a person's potential.

Education increasingly organised on a commercial model risks turning learning into a commodity, parents into customers and qualifications into products.

There are lessons to be learned from Nordic approaches, particularly Finland's emphasis on adapting teaching and providing support according to pupils' needs.

Academic, technical, practical and creative pathways all deserve recognition. We should avoid forcing every child into a single mould and then relying on tuition centres to address gaps. A successful public education system should develop each child's potential without making parental purchasing power a prerequisite for opportunity.

Apanama is back: The 30 percent bumiputera equity policy, dating back to the 1971 New Economic Policy, should be assessed based on whether it has built lasting economic capability.

Research by economists such as Jomo Kwame Sundaram and Edmund Terence Gomez has examined rent-seeking and its effects on the economy and equity distribution.

Mandatory equity requirements can sometimes result in nominal or passive shareholders holding shares primarily to satisfy regulatory requirements, without contributing capital, skills, labour or enterprise value.

Reserving or transferring shares does not, by itself, build competitive skills, market discipline or the capacity to participate in global supply chains.

Such requirements can also increase transaction costs, create policy uncertainty and affect business expansion decisions.

These equity requirements are implemented through ministerial guidelines rather than Acts of Parliament. This gives ministers considerable discretion over the conditions attached to Bumiputera participation.

Over the decades, a relatively small group may have accrued a significant portion of the benefits, while lower-income bumiputera continue to require broader forms of economic support.

Undecided: Former Yayasan Peneraju CEO Ibrahim Sani said the key question was whether the requirement had delivered tangible economic benefits to the bumiputera community.

“Where is the efficacy and impact study on this policy, the 30 percent equity ownership, not just for tuition centres, (but for) everything?” he asked.

There is little doubt that the NEP has delivered benefits and raised the wealth of bumiputera after more than 50 years of implementation.

However, the efficacy of its implementation, as rightly pointed out, is debatable, as hundreds of billions, if not more, have been spent in the process. If the criteria are lifting most bumiputera out of B40, it clearly failed. Also, the wealth gap between the rich and the poor in the community has widened tremendously.

Meerkat: How can it help if the 30 percent is concentrated among a relatively small number of individuals? bumiputera in general might have benefited more had the government also promoted greater economic cooperation.

More partnerships between bumiputera and non-bumiputera businesses could have helped expand participation while spreading opportunities among a wider section of the population.

There would also have been greater potential for genuine knowledge and skills transfer.

Optimus: Proxy participation is not merely a technical issue. Where shareholders receive financial benefits without making a meaningful contribution to the business, questions arise about whether the arrangement is creating genuine economic participation.

Winning Scarecrow: If 30 percent is considered insufficient, some may argue for a higher target. But the more important question is whether any target actually delivers broad-based and sustainable benefits.

RedWolf1406: It ultimately comes down to whether bumiputera shareholders are able and willing to contribute to the businesses in which they participate. Responsibility, skills and value creation should ideally accompany ownership.

GrayParrot9290: What does the economy minister say? He previously stated that cabinet approval was needed because this involves bumiputera empowerment.

Koel: It is a case of a country needing to review policies when they outlast their usefulness, prove ineffective or are not producing the intended outcomes. Countries need the maturity and flexibility to adjust policies when circumstances change.

BrownRabbit3061: Providing equity without building the ability to manage and grow that wealth does not necessarily lead to independence. Long-term empowerment should focus on developing skills, enterprise and the ability to create sustainable wealth. - Mkini