An election budget or an “erection” budget?

budget1.gifPM Najib has blown it. He had a chance to set critical things right during his presentation of Budget 2011, but instead he is being pilloried in social media spheres. Blogs, Facebook, Twitter — Malaysian in these spaces have not spared him the ridicule and contempt his Budget largely deserves.

RM212 billion, with a large chunk of it on mega multi-billion ringgit projects? An MRT for RM40 billion, a 100-storey tower of wank for RM5 billion, RM26 billion for a Financial District? It all seems so exorbitant in a time when we need to be laying the foundations to break us out of the middle income trap and onwards towards becoming a high income nation. Instead, what the PM is trying to do is exactly what his predecessors did to get us into this trap in the first place: spend, spend, and spend some more.

Let’s not be naive: in the real world, you need to spend money to make money. In country terms, you need to invest in projects to stir the economy, to get the financial juice flowing, to stimulate liquidity, to create jobs, to encourage further spending. A Government that doesn’t spend is as fail as a Government that spends too much.

Having said that, it doesn’t mean that the bulk of your budget should be used for this purpose, and certainly not in projects that will tend to favour the few rather than the many. An MRT in KL does nothing to stir the economies of Terengganu, Sarawak and Sabah. Neither does a tower that nobody wants, nor a financial district that will surely fail unless it’s backed up by a reform of financial policies and a steady inflow of foreign capital (FDI). 

It would have been so easy to get things right, Mr Najib. I’m just a common man, and even i can see what this country needs. You, with your army of analysts and advisors, could not?

Why couldn’t you use the budget speech to announce a multi-billion allocation into education, to build up existing universities, provide training for teachers, or drastically improve the attractiveness of the teaching profession to attract the best talent we have to become teachers? Nowadays, many teachers become teachers because they couldn’t cut it in the private sector — this needs to change. What we need is the best talent want to be teachers, not because they’ve exhausted other options.

How about the attraction of FDI? It’s been widely reported, Malaysia’s ability to attract foreign investment is at record low levels, especially relative to the performance of other countries in the region in this regard. We need to make it attractive for foreigners to bring their money to Malaysia — where are the incentives to make that happen? We may spend billions to build a Financial District (and awarding its development to 1MDB which has absolutely no track record), but if investors are still afraid to bring their money to Malaysia, then we’re missing the point of it all. 

The Government is suffering from an image crisis. When it announces these mega-projects, why do people think that a lot of this money will be lining the wrong pockets? Will cronies and favourites be awarded these lucrative deals? That’s the perception that many people have. It’s not bad enough that we’re spending so much money on the wrong things, but many people believe that it’s so much money for so few. That negativity needed to be managed, but nothing was said to address it.

Why not say openly, during the budget speech that the contracts for these projects would be handled via a transparent and open tender? Why not assuage the fears of the sceptical and the cynical when there was an opportunity to do so? Surely, their cries of foul play were anticipated, why not nip their protest in the bud?

This budget failed, for me, not because of all the things it did say (and many of that was poor too), but even more so because of the things that it didn’t say. I’m a great believer in making the most of opportunities, especially opportunities to get things right. PM Najib really missed the boat on this one. Instead of a real “election budget” that would have boosted the Government’s chances of staying in power, he has to make do with the mocking disbelief of an “erection budget”. 


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