Causes of Rising in Living Cost

There is no need for a special cabinet committee to study the rising cost of living as the root causes of the problem have already been highlighted in the Auditor General's Report, a political analyst said.

Institute for Democracy and Economic Affairs chief executive Wan Saiful Wan Jan (pic) said weaknesses in the government's handling of finances have already been made known in the report.

"Those are some of the root causes right there. Government wastage, extravagant spending and corruption are a few reasons why this is happening.

 "And it is all in the AG's report. So we don't need a special committee, which will only be an extra layer of bureaucracy, to tell us this," he said.

The scathing remarks from the political analyst comes following an announcement by Deputy Prime Minister Tan Sri Muhyiddin Yassin that a special committee to tackle the cost of living would be set up, to handle the issue in an integrated manner.

Muhyiddin had said that one of the committee’s roles was to coordinate the policies and programmes of the various ministries and agencies involved in easing the burden of the people, and collaborate with the fiscal policy committee – chaired by the prime minister – in scrutinising the government's taxation policy and subsidy rationalisation.

"The outcome of the study would be announced to the public through the various media to facilitate the people in making comparisons and to understand the actual reality on the price increase," he was quoted as saying.

However, Wan Saiful said that he feared the committee would only come up with more "subsidies and cash handouts", such as the Bantuan Rakyat 1Malaysia (BR1M) as solutions to the rising cost of living.

"But that (subsidies and handouts) is also one of the sources. The government has finally realised that it does not have the money to continue with these things.

"We are now suffering as a result of bad decisions by the previous government," he added.

Public Accounts Committee (PAC) chairman Datuk Nur Jazlan Mohamed also said that there was no need for a cabinet committee to address living costs if ministers coordinated their work.

He said that ministers only had to work together to show they are sincere in helping the public, especially in the wake of skyrocketing prices of necessities.

"If there is coordination among ministers, there is no need for this cabinet committee on living costs chaired by the deputy prime minister himself," Nur Jazlan added.

DAP secretary-general and Penang chief minister Lim Guan Eng also poured cold water on the setting up of the committee, saying that it would not change anything if it could not ensure that salaries are increased to help the people cope with rising prices.

He said Muhyiddin has used a lot of "fancy academic terms" without addressing the two main issues that concern 28 million ordinary Malaysians: whether Barisan Nasional (BN) is going to reduce prices or increase salaries.

"What is the use of the BN government spending money to create a special laboratory for two weeks beginning today to study measures to ease the burden of the people when they cannot even understand that price increases are not about the price of kangkung alone."

RAM Holdings Bhd group chief economist Yeah Kim Leng agreed, adding that while Muhyiddin's idea was good, it should look into the salaries of Malaysians.

"That is the key to ensure the people will be able to cope. You can't stop price increases.

"The pay should rise faster than inflation," he said.

Yeah called on Putrajaya to get its economic management philosophy right by not interfering with the prices of goods.

"Free market will ensure prices are competitive so the government should not interfere in the pricing system," he said.

"Eliminate monopolies that are keeping prices of goods high," he said, adding that the committee should also educate the public on how Malaysians can cope with the rising cost of living. – January 18, 2014.