KUALA LUMPUR – The latest iteration of the nationwide movement control order (MCO 3.0) announced on Monday should have been immediately accompanied by the rolling out of government assistance for the rakyat.
Prominent economist Muhammed Abdul Khalid said that the announcement of a stimulus package should not be delayed, considering that the current lockdown could have even more far-reaching implications.
Speaking at the launch of the United Nation’s final edition of the Family on the Edge report yesterday, he said that aid is particularly vital as most financially vulnerable families would have depleted their savings by now.
“During MCO 1.0 and 2.0, there were a lot of government incentives,” said Muhammed, who is the lead consultant of the study.
“There were moratoriums, cash assistance, grants for small business owners and wage subsidies, while those renting PPR (People’s Housing Project) units were given rental exemptions and discounts.
“Remember, this past one year, most low-income households would have already used up their savings.
“Without assistance now, MCO 3.0 will have a dire impact. It must be accompanied by government aid. Otherwise, it will be a great injustice to these families,” he told an online panel discussion held in conjunction with the launch.
On when would be a good time for the aid to be rolled out, Muhammed said: “It should be yesterday (Monday); it should be now.”
In its report, the UN Children’s Fund (Unicef) and UN Population Fund (UNFPA) found that a large number of poor families living in low-cost housings in the city centre are being forced to dip into their savings and cut down on food consumption to survive the pandemic.
The survey also found that almost half of the households were unable to meet essential expenses, of which about 60% could not afford to put food on the table or pay their bills on time.
Prime Minister Tan Sri Muhyiddin Yassin had on Monday announced that the country would be placed under a nationwide MCO from today to June 7, amid a spike in Covid-19 infections and with intensive care units in public hospitals nearing full capacity.
He had also said that restrictions on interstate and inter-district travel, as well as prohibitions on education, social and sports activities, would be effective immediately until June 7, although most economic sectors are allowed to operate.
Bank Negara Malaysia also said earlier yesterday that a blanket loan moratorium is not the best solution for all borrowers, and that those in need should discuss with their banks on ways to help them fulfil their loan repayment obligations.
Muhammed, who was also economic adviser to Tun Dr Mahathir Mohamad during the latter’s recent tenure as prime minister, said that the question of whether giving out cash handouts is doable now, considering the amount the government has already spent, should be secondary.
“If they (low-income households) are vulnerable and affected, they should be given a monthly cash handout,” he said.
“The government knows who they (affected citizens) are, the issue of mistargeting the recipients has been very much minimised. So, the aid should be continued,” he said.
He also said that, the government also stood to gain by giving out assistance, as the people would have more cash in hand to spend and stimulate the economy.
“Take a person living in flats. If I get even RM1, I would spend the money in a shop downstairs. The business gets profit and they will pay tax to the government,” he said.
“So, RM1 spent on the poor is good for the economy. It’s not only helping the families, but helping the country grow the economy. It’s not a zero-sum game. There will be a lot of multiplier effects that will benefit society.” – The Vibes, May 12, 2021
