Report card on PH’s first-year performance.
The Pakatan Harapan government has realised or put on track nearly a third of its election pledges for the economy but others are proving difficult to reach, the IDEAS think tank noted in its report card on the coalition’s first-year performance.
The “Projek Rantau” report said PH achieved some notable successes such as abolishing the goods and services tax and restructuring the 1Malaysia Peoples’ Aid programme while showing commitment on several key economic targets that include efforts to reduce living costs.
“In many of these areas, the real test will be implementation but it is encouraging that the government is on track to deliver these important reforms,” said Faiz Zaidi, executive at the Democracy and Governance Unit, IDEAS.
“The government should maintain momentum in these areas and should ensure these successes are communicated clearly to the public to build confidence in the government’s performance.”
The report card tracked and analysed a total of 192 sub-promises that branched out from the 23 primary pledges listed in the ruling coalition’s election manifesto.
Each sub-target was rated from zero to five; zero meant no progress while five indicated fulfilment.
The pledges were then divided into three main pillars. The first is reduction of burden, second is institutional and political reform and third being sustainable and equitable economic growth.
Among the most notable successes was the swift move to abolish the GST, the report noted. However, it also noted that scrapping the tax has had marginal impact on living cost pressures.
IDEAS said the PH government’s focus on control measures and subsidies meant much of the systemic problems in the supply side remain unaddressed.
“Furthermore, the cost of living debate itself often does not distinguish between rising costs, stagnant wages and changing consumer habits – each of which needs to be addressed to manage the cost of living,” the think tank added.
IDEAS also commended the government for laying out an ambitious plan to tackle corruption, including important reforms of the public procurement system, which was among PH’s key reform pledges.
Yet IDEAS also said many of the promised institutional reforms were wanting. Commitment to meritocracy in appointments in government-linked companies (GLCs) remained questionable, and PH has not laid out a clear strategy to curb GLC monopoly.
“The prospects for significant reform of Malaysia’s GLCs seem limited,” the report said.
“Despite frequently stating that ‘the business of government is not to be in business’ there has been no strategy put forward to reduce the influence of GLCs in the economy or even seriously review their role.”
IDEAS also cast doubt on the government’s commitment to affordable housing. It said while PH is already implementing a detailed strategy, it lacked clarity and vigour to achieve the ambitious promise to build one million more affordable homes over the next ten years.
“The issue, in this case, is the extent to which these policies will address the underlying issues in Malaysia’s housing market, including a persistent oversupply (suggesting further falls in prices required),” it said.
“High levels of household debt making further easing of credit risky; and an ongoing hope that the government can “direct” the construction of affordable housing, despite a history of failures with multiple government agencies and overlapping mandates confusing the market.”
IDEAS in its recommendation said success in delivering these targets will hinge on the government’s ability to recalibrate its approach. – MMO