The Gomen’s ultimate aim is to get rid of all the subsidies – on fuel, cooking oil, sugar, flour, etc.
That’s the target. Cut, cut, cut until we reach zero subsidy.
• 2012
Gomen reduces subsidy, saves billions and pays out BR1M worth RM500 to each recipient
• 2013
Gomen reduces subsidy, saves billions and pays out BR1M worth RM500 to each recipient and expands the programme to include orang bujang.
• 2014:
Gomen reduces subsidy, saves billions and pays out BR1M worth RM650 to each recipient while singles are given RM300
• 2015
Gomen reduces subsidy, saves billions and will pay out BR1M worth RM950 to each recipient while singles will now be getting RM600
The consultants will have completed their job – beres – when the end result is that there are no more subsidies left to cut.
When that happens (i.e. when the day of reckoning comes and the essential items are all sold at market price), will Najib then still continue giving out BR1M?
(160 words)
Helen Ang 
Seventy years old and a pensioner and I’ve never tasted BR1M. When it all ends it won’t make any difference to me although I will sympatise with those who have been made dependent on BR1M.
I hope it won’t end just like that, abruptly, but will be a gradual one so that people who have been receiving the payout will be let down gently.
BR1M is okay as it encourages spending and keeps the economy going (if one wants to look at it that way) but has done some damage to the psyche of those who have been waiting for it year in year out.
The BR1M amount has doubled from RM500 in 2012, to RM950 in 2015.
It doesn’t seem as if Najib is in control.
As far as I understand BR1M is intended to be cushion for low income earners to cope with rising fuel cost. The handout was also itemized under fuel category.
Click to access b11.pdf
Pg 200, under accounting code 020500 (credit to HishamH of econsmalaysia)
I am wondering whether BR1M covers rising cost of goods and services though.
Well may be at that time there will be no more Najib to give br1m either by defeated PR in pru14 or kicked out by umno members.
removing subsidies to prevent exploitation and manipulation is a good move. but how to transfer the subsidies to those who deserved it is a question need an answer.
I dont agree with giving cash because it may not achieve the objectives of helping the poor. they might not use it for the right purpose. gov should come up with a mechanism to distribute the subsidies like using coupon to buy essential items such as rice oil sugar and flour or discount for electricity and gas..
I was wondering how how long Najib more promised the BR1M.
2012 – Cut subsidies – give BR1M
2013 – Cut subsidies – give BR1M
2014 – Cut subsidies – give BR1M
2015 – Cut subsidies – give BR1M
Eventually all the subsidies will be cut.
When there are no more subsidies to be cut (and hence no more savings to be had by the Gomen), will Najib still be giving out BR1M in 2019? 2020?
Well, he did say he was giving it until 2018 at least according to the GE 13 manifesto topping up at RM1200.
Interesting to see if he’ll still be around pre GE14
Then in 2019 post-election, all those millions of BR1M dependents will suddenly have to go cold turkey.
And across the board, everyone of us are left saddled with expensive petrol and diesel, expensive cooking oil, expensive sugar, etc and high cost of everyday goods.
Chua Tee Yong said that tax payers “will enjoy” between 1-3% reduction in income tax rate with GST.
Yeah, I’m sure most middle income household spend less than RM10000 annually on GST rated items to allow them to enjoy the RM600 savings that translates to.
http://m.thesundaily.my/node/275365
What is the Gomen gonna do with the GST money?
It is anyone’s guess what the gov is going to do with the money. We don’t even have a clue what’s going to get taxed. The list is yet to be released anyway.
We will have inflation. That’s for sure. With implementation so and so judging by the could not care less attitude of the gov, this will spark more anger on the part of the people. I actually believe inflation could top the 4% mark before the end of 2015. Businesses are going to take this opportunity amidst the initial chaos and confusion to jack up prices.
Subsidies are on the way out because they are not viable. Forget about the oil and gas money from Petronas. Petronas is a Fortune 500 corporation. It is now venturing overseas because our oil and gas reserves are not going to sustain us any longer. They have to find new reserves. The money is going to be reinvested into their operations. So less tax money from Petronas.
The subsidies are now enjoyed by the affordable people therefore there are leaks.
BR1M also got leaks what.
It was reported that BR1M was offered to people who refused to take the payment.
Cash hand out or rebate to taxation usually paid to the public when there is consecutive of budget surpluses (for example in Hong Kong).
In Malaysia, I guess we are experiencing consecutive budget deficit. One way to reduce budget deficit is probably to reduce the fuel and other subsidies although there may be many other ways to reduce the budget deficit.
Reducing subsidies will incur inflation and higher prices. BR1M then was introduced to lower income group to compensate for the rising cost of living due to removal of subsidies.
Gomen is trying to solve the major issue, budget deficit, but along the way has to give out BR1M cash handouts. If the Gomen has budget surplus, then there is no need to remove subsidies. Ini jadi macam lagu dangdut…gali lubang, tutup lubang.
If all subsidies have been removed but Gomen still experiencing budget deficit..then we are in trouble..inflation and prices of goods will be spiraling upwards..Gomen will be facing with the toughest choice on how to continue with BR1M..
Gomen need to ensure a surplus budget in order to continue with BR1M. For a deficit budget or break-even budget, then the Gomen has to increase fuel price by another 20 sen again to pay for BR1M…this will become a never ending scarry nightmares…Nightmares On Elm Street…
Exactly.
Najib keeps slashing and slashing the subsidies. Every few months subsidi ni dan subsidi tu dipotong until the Gomen reach zero subsidy, which is what Pemandu wants.
Eventually when they run out of subsidies to cut because all the subsidies have been taken away already, then how will Najib continue to fund BR1M – the amount which doubled from RM500 to RM950 in a mere three years?
Re: Gomen is trying to solve the major issue, budget deficit, but along the way has to give out BR1M cash handouts. If the Gomen has budget surplus, then there is no need to remove subsidies. Ini jadi macam lagu dangdut…gali lubang, tutup lubang.
The difference between “before fuel subsidy slash and after subsidy slash” is top 20% earners will not be eligible for the RM0.20 subsidy anymore. Saving from top 20% earners from using subsidy oil is what being passed to those who classified as “BR1M worthy”.
I did simple calculation based on what I data I can gather not long ago. My findings was that top 22% income earners use up to 3times more subsidy vs lower 45% income earners (53% vs 18%).
According to HishamH of econsmalaysia, IMF findings is as high as 6X (top20% vs lowest 20%).
Anyway, middle class who can’t get BR1M is the worst affected IMO.
I’m irked with this photo: [Facebook]
and this: [Facebook]
I m all for subsidies to be abolished but it has to be done in phases. The government must let the people know when it intends to phased out the subsidies. The sooner the subsidies are abolished the better it is for the economy.
Subsidies create an entitlement mentality. You feed the person without telling the person that he needs to help himself and that person will continue to depend on you. This will only deepen the dependency. Of course people will get mad but if this continues worst things will happen.
re: “Subsidies create an entitlement mentality.”
Cash handouts like BR1M create an even more pronounced entitlement mentality.
And what has the Gomen been doing with all the subsidy savings so far?
Let’s say that it saved RM8 billion (just tossing a figure*) through subsidy cuts and spent RM5 billion on BR1M. What else has the savings been spent on?
* Can anyone pinpoint how much money has actually been saved by the Gomen and how much of it given back (targetted redistribution)?
What goes up must come down and there goes the other way round, I think you may be around Helen and maybe I wont be around and Budget 2015 main focus is of cause’ cost of living’ and how our dear PM going to orchestrated this time and with 3 piece band THE PEMANDU around in its usual manner often take this occasion and will they enchanting with here right waiting..ha ha
Actually Helen the Gomen can’t afford to spend the saved subsidies money on anything. They need the subsidies money for a balanced or surplus budget. If the Gomen still having a deficit budget after all subsidies removed, then kita menzalimi rakyat for no reason.
BR1M is more of a political carrot. But as you said it has created a very pronounced entitlement mentality. If BR1M is removed, the Gomen will not survive. Cash hand out is something the gomen can’t afford to play play with.
Tabik Ah Jib Gor!
Re If BR1M is removed, the Gomen will not survive.
Even with BR1M they got barely half the popular vote in GE13 :)
The Chinese take the BR1M money but pangkah Roket anyway.
Have you ever heard a word of appreciation from the Chinese Street for any single one of Ah Jib Gor’s Transformasi initiatives?
No. Their way of thinking goes like this. It is your job to do those things. If you don’t do it someone else will do. We vote for whom we want and that’s none of your business.
You see the damage this sort of mentality is having on them. But to them this is normal.
So the more goodies you give them, the more emboldened they become. They push their luck and ask for more.
We need a balanced or surplus budget so that the Gomen don’t have to borrow money to fill up the deficit.
Large external debt (hutang negara nak menampung Perbelanjaan disebabkan budget deficit) together with consecutive budget deficit and horrendous inflation is a recipe for economic disaster.
Kalau kita berniaga setiap tahun rugi (deficit), kita hutang bank utk bayar gaji, bayar bonus (BR1M).. Tak lama syarikat akan bankrap.
The International Jew..
As Helen has put it brilliantly… “MUSUH DIDAHULUKAN, PENYOKONG DIPINGGIRKAN”
Simply wrong strategies.
l o l ! Enemies rewarded Supporters abandoned l o l ERSA ! l o l !
The proper question should be :
Will Najib still remain as PM, and BN still in power?
For me if they want to give BR1M it should go with programmes to help the recipient elevate their standard of living. And those receiving the help should be made clear that they should work hard and make use of every help given by the government with the aim to get their names off the BR1M recipient list.
When there are no more subsidies to be cut (and hence no more savings to be had by the Gomen), will Najib still be giving out BR1M in 2019? 2020?
By that time 1MDB should have yield high income from their investment , so the income will be shared with the rakyat and be call PRIM (pendapatan rakyat satu Malaysia) no more bantuan
That why all 1MDB investment and account being kept under secrecy
:D
Oh come on now. How could you say such hurtful things ! The people can’t wait till 2020. By then the treasury would have been emptied [deleted].
By exposing them so soon you risk being arrested for violating the Official Secrets Act. l o l ! You are one brave individual. l o l !
You mean this ?
Taking Shape: Tun Razak Exchange [YouTube]
Can or not this one ?
Dear Helen,
I really like all of your previous posts. Nampak macam you did good job on analyze all the facts before do the writing. It was almost impossible to deny all the facts and information you deliver. But for this topic, I think you tergesa-gesa buat conclusion.
Perbelanjaan kerajaan setiap tahun untuk subsidi telah menjadi operatuinal expenditure yg mmg Malaysia kena tanggung. Bukankan dgn mengurangkan subsidi ini kerajaan akan ada lebihan wang untuk pembangunan. No subsidy equal to more cash flow for development.
Apa yang you maksudkan dgn apabila sudah tiada lagi subsidi untuk di potong? Saya tidak nampak the co-relation…. harap anda boleh betulkan. Personally saya pun tidak menyokong kenaikan harga barang, but really admire when you did all the writing macam real academician. Jgn terikut sangat sentimen negative.
Regard
GENERASI BARU
iMO BR1M is better than oil subsidies as the money stays in the economy and recirculated.
Oil subsidies meamwhile are burned away into CO2 by fools in their D class cars.
BR1M aka cash handdouts are not a PEMANDU creature, Indonesia itself have routinely given cash handouts when they reduce gas subsidies.
re: “BR1M aka cash handdouts are not a PEMANDU creature”
If Pemandu hatched and executed the programme, and the PM budgeted for it under Pemandu advice, then why is it not a Pemandu creature?
2,500 years ago a man named Confucious said: “Give a man a fish, you feed him for a day. Teach a man to fish & you feed him for a lifetime”.
Najib’s consultants are busy making malaysians into a bunch of unindependant whinners.
To top that up we are already a society of reactives instead of proactives, case in point – build traffic light at a junction only after high cases of accidents, instead of having one before accidents happen.
In the same breath, Proton could have developed energy efficienct vehicles (eev) 20 odd years ago, sekarang baru nak terkial-kial tapi competitors are years ahead. Rakyat tak mampu nak beli sebab tax tinggi these other eevs. Tax tinggi sebab policy kerajaan to prop up/save Proton, ridiculos cycle.
Also with all the ‘so-called expertise’ that Najib has, why havent we embarked on a proper sovereign wealth fund, eg Norway’s?
Does Najib really know what to do?
2,000 years ago, a man named Ali ibn Abi Talib (r.a) said- “Do not be too hard, lest you be broken; do not be too soft, lest you be squeezed.”
Wait for it, soon enough the government and others will start beating down on those receiving BR1M, calling them lazy and foolish. When it happens forget any big increases again and the poor will feel the pinch of every price rise.
Still, the country needs to manage its finances as oil windfalls continue to reduce. Unless we invest in renewables, there will be an increasing outflow of funds to pay for oil and coal imports.
Helen had a simple question but the answer is not important because by the time it happens there will be another distraction.
Things get dangerous for a country when too many people take the time to consider what the real issues are and what’s really important. Instead, it’s best to keep people moving, following a dream no matter how vacuous or un1Mportant.