What is the real cost of the NEP? Do we really know? (UPDATED with Chinese Translation)
Seriously, I am only ‘guestimating’ here. I honestly do not know the real figure. But if you take into consideration everything I have mentioned above and total up the real cost of the NEP, you may probably see that it is a colossal figure. You might even fall off your chair when your calculator clocks a figure of RM500 billion in total.
NO HOLDS BARRED
Raja Petra Kamarudin
March 2010 appears to be the month of debate regarding the NEP, the Bumiputera share of the economic pie, and whatnot.
Okay, never mind if it is 3%, 19%, more than 30%, or should be 67% (Chinese say 67 is ‘lok chat’ or cock). No one appears able to give the real figure or show how much the Bumiputera share of the economic pie really is.
The issue currently being raised by Lim Guan Eng is not how much the Bumiputeras still own but how much the Bumiputeras were initially given. What they still own might no longer be 30%. It could even be 19% or 3% or whatever. That is not the real issue. That is what they have left. We need to talk about what they had before it was reduced to 19% or 3%.
Do you know that many Malays own expensive properties in other countries, huge sums of cash in overseas bank accounts, large foreign investments, and whatnot (Daim alone owns 10 banks)? Maybe you do not see all this in Malaysia. So it appears like there are no filthy rich Malays. This is a fallacy. There are many filthy rich Malays but they have ‘hidden’ their ‘worth’ in other countries.
This makes sense of Lim Guan Eng’s statement that the Malays were given RM54 billion worth of shares and that RM52 billion have ‘disappeared’. It has not disappeared. It is just hidden from view. It does not mean it is no longer there just because you do not see it in Malaysia.
Now, note one thing, those RM54 billion worth of shares were given at par value, which was far lower than market value. When did these people cash out? You would normally cash out only when you can make a huge profit. So what was the ‘missing’ RM52 billion worth when they cashed out and moved the money overseas? Can I safely assume that the RM52 billion would have easily been RM100 billion at the time these Malays divested? I mean, the TNB and Telekoms shares alone, which were RM5 and RM4.50 per share, shot up way past RM10 per share when many started selling them.
That was more than double.
Okay, that is only as far as shares are concerned. And that is something which is easily enough to calculate and is no secret. What about contracts given to private Bumiputera companies? How much contracts went to sendirian berhad companies over the last 40 years since 1970?
Okay, let’s make an educated guess. RM2 billion a year? That’s a paltry sum. The development budget itself is 20 or 30 times that. You mean only 5% to 10% of the contracts went to Bumiputeras? It is actually more. But even if you take that paltry sum it is still RM80 billion over those 40 years. (And I am not even going to talk about APs, which Tun Dr Mahathir himself admitted will run into hundreds of billions of Ringgit).
Alright! Lets move on. Forget about shares and contracts. Let us now talk about education.
I personally know a Malay doctor who the government spent RM1 million to educate in England over seven years. I can believe that because it cost me RM300,000 to educate my daughter in England over three years. And if she had done medicine it would have cost me much more than that — I checked.
How many Malays received a college/tertiary education because of the NEP over the last 40 years (both local and foreign)? I don’t know the answer. But for argument’s sake let us just take a figure of one million students although we know it is higher than that.
How much did it cost the country to build all those colleges/universities and run them since they were built? Add that cost to the cost of sending Malays overseas since 1970. How much would it come to in total? I don’t know the figure but even if we take an aggregate figure of RM100,000 per student, one million students would come to RM100 billion.
And trust me, RM100,000 per student and one million students is very much on the low side if we not only take the cost of the overseas universities but also the cost of building, managing and maintaining local colleges/universities as well.
In business there are always hidden costs. In the NEP there are hidden expenses. If you add up all these ‘NEP expenses’ to the value of the RM54 billion shares given to the Bumiputeras, then you can see that a hell of a lot was given to them.
The NEP is not just about shares. It is also not just about government contracts. It is many things. What about all those FELDA, FELCRA, RISDA, KADA, MADA, KEJORA and God knows how many more land settlements and agricultural schemes?
What about the many agriculture subsidy schemes involving subsidised fuel plus free fertilizers, tractors, fishing boats, marine engines, outboard motors, fishing nets, wire netting (bubu), artificial reefs (tukun tiruan), and a host of other things?
What about the bloated civil service and GLCs (that never make any profit but money keeps getting pumped into them anyway) that employ a large percentage of Malays (who were educated at the cost of the taxpayers) which costs us loads of money over the last 40 years? And even when they retire we shall still be paying their cost,
Yes, let us look at the TOTAL cost of the NEP, not just the RM54 billion shares where RM52 billion has already ‘disappeared’.
Seriously, I am only ‘guestimating’ here. I honestly do not know the real figure. But if you take into consideration everything I have mentioned above and total up the real cost of the NEP, you may probably see that it is a colossal figure. You might even fall off your chair when your calculator clocks a figure of RM500 billion in total.
And I am not exaggerating here.
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Where are RM52 billion Bumi shares, asks Guan Eng
DAP secretary-general Lim Guan Eng wants the government to investigate why RM52 billion worth of shares in public listed companies allocated for Bumiputeras under affirmative action policies were no longer in their hands.
He told reporters in Parliament today that the fact that the shares were no longer in the hands of Bumiputeras was an act of betrayal.
The Penang Chief Minister suggested a Royal Commission be set up to investigate such leakages.
He said that out of RM54 billion in shares allocated for Bumiputeras, only RM2 billion were still in their hands.
“According to a Bernama report, the Prime Minister had been quoted as saying that of the RM54 billion in shares allocated, only RM2 billion worth of shares were left in the hands of Bumiputeras,” said Lim.
“There is a leakage of RM52 billion which is not in the hands of the Bumiputeras. This is a betrayal. The government has to arrest and take action against the people who have hijacked the money,” he added. — The Malaysian Insider, 29 March 2010
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Update on wealth data
The data on wealth distribution in the country will be updated, said Deputy Prime Minister Tan Sri Muhyiddin Yassin.
He said the updating would cover the distribution by race so the people’s socio-economic achievements could be evaluated.
“Current records show that a large portion of the nation’s wealth is in the hands of the non-Malays.
“Maybe that (the data) needs to be updated,” he told newsmen after closing the National Parent-Teacher Association Convention at the Institut Aminuddin Baki here yesterday.
He was commenting about a suggestion by former prime minister Tun Dr Mahathir Mohamad that the Government conduct a comprehensive study on wealth distribution in the country. — The Star, 29 March 2010
Translated into Chinese at: http://ccliew.blogspot.com/2010/04/nep.html
