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Foong Li Mei brings to you another edition of REFSA Rojak, a weekly take on the goings-on in Malaysia by Research for Social Advancement (REFSA).

REFSA Rojak – “trawl the newsflow, cut to the core and focus on the really pertinent. Full of flavour, lots of crunch, this is the concise snapshot to help Malaysians keep abreast of the issues of the day.”

Borrowing for the purpose of lending

How safe are Malaysians’ retirement savings in the Employees’ Provident Fund (EPF)?  EPF is proposing to channel RM1.5 billion of its contributors’ money to facilitate housing loans for low-income borrowers in Kuala Lumpur who are unable to obtain regular financing from commercial banks.

Federal Territories Minister Raja Nong Chik is ‘not worried’ about the borrowers not repaying their loans, as Dewan Bandaraya Kuala Lumpur (DBKL) could buy back and resell the properties, which he said would be worth double or triple the purchasing price.

Backing him is Prime Minister Datuk Seri Najib, who reiterated that the loan would not adversely affect EPF contributors, as the amount is not big when compared to the total funds EPF has.

Nonetheless, the scheme does not sit well with many. DAP’s national publicity secretary Tony Pua warned that EPF providing loans to individuals breaches the EPF Act . He also pointed out that what’s disturbing is that the loaners are sub-prime i.e. they do not qualify for such loans or will have trouble repaying them. This has nothing to do with whether the properties are valuable or not.  The ability of DBKL to repay EPF, should there be defaulters, is also questioned.

EPF, however, does not seem to share Pua’s reservations. It is currently in talks with the government. The deal has yet to be inked, but EPF assures that it is not offering loans directly to individuals. Instead the money is lent to the federal government through a special purpose vehicle linked to the Federal Territories Foundation (SPV FT Foundation), which EPF claims is ‘safe’.

Rembau MP Khairy Jamaluddin also reasoned that the risk of the loan scheme is borne by the government, not the EPF. While he rebuked the opposition leaders for making misleading arguments, Khairy also criticised Putrajaya for its lack of quality response and timely rebuttals to allay confusion.

Khairy’s criticisms ring true. Helping the poor to own homes is noble, but we need straight answers – why does the government need to borrow from the EPF to fund its public housing scheme? How would the eligibility requirements for this loan scheme differ from those for commercial banks? What type of housing is involved? EPF may not bear the risk of the loan, but that doesn’t mean our money should be gambled with.

Paying for sweet nothings?

Has the sugar subsidy been fattened by a sweet deal our government made with sugar suppliers? Malaysia has signed a long-term deal above market price, thus spiking the sugar subsidy bill to RM567 million this year, compared to RM262.4 million last year.

The Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Ismail Sabri Yaakob explained that the government has signed a three-year contract to buy sugar at US$0.26 per pound, despite its global price dropping to US$0.23 per pound. The increase in subsidy is meant to peg local sugar price at RM2.30 per kilogramme. The minister added that if global sugar prices climb, our country will benefit.

This reasoning is met with quizzical expressions. Moreover, traders do not foresee any rise in global prices due to ample supply, prompting speculation that the subsidy bill was blown up to benefit firms that monopolise the domestic sugar supply. Ismail however had refuted the allegations.

The ‘sweet’ subsidy leaves a bad taste in the mouth for the Consumer Association of Penang. Calling upon the ministry to scrap the sugar subsidy, the association reasoned that the government would not only end up saving RM567 million, but also ‘millions in healthcare costs when it does not have to treat sugar-related diseases’.

Un-1-ted Care

As the syrupy subject lingers still in our mouths, it is obvious that a spoonful of sugar would hardly help the 1Care medicine go down. The recent proposal to impose a mandatory contribution of 10% of our salary to the health insurance fund is a bitter pill to swallow. Even doctors are pointing out that there is nothing caring about the 1Care plan.

Dr T Jayabalan, the Citizens Healthcare Coalition spokesman, deemed 1Care as a ploy to enrich private practices. Besides the mandatory contribution, the proposed healthcare plan will reportedly assign an individual to specific doctors and limit Malaysians’ number of hospital visits per year.

Health Minister Datuk Seri Liow Tiong Lai administered a shot of assurance, saying that the 10% medical levy was just a proposal, and the ministry will seek public feedback before finalising any plans. Nonetheless, it has been reported that the 1Care system is in its final stages. Jayabalan further revealed that nationwide roadshows to promote the plan have kicked off.

Why the haste? Bitter pills are sometimes taken for our own good, but it is those forced down our throats that we should be particularly wary of.


Why ‘Rojak’? Disparate flavours and textures come together in a harmonious mix to make this delicious but underrated concoction. Our Rojak weekly is much like this mix, making sense of the noise of daily newsflow and politicking.

It is also our ultimate dream that our multi-ethnic melange of communities can be made richer within the unique ‘sauce’ that is Malaysia. Let’s take pride in the ‘rojakness’ of our nation!

Click here for previous issues of REFSA Rojak.

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REFSA is an independent, not-for-profit research institute providing relevant and reliable information on social, economic and political issues affecting Malaysians with the aim of promoting open and constructive...