Cut costs, not increase prices, Dr Mahathir tells Putrajaya
(TMI) – Tun Dr Mahathir Mohamad (pic) said today that Putrajaya can increase its revenue by cutting costs instead of raising prices of necessities, despite needing a bigger amount annually to manage growing expenses.
Weighing in on the current debate over rising prices, which according to some pundits could cost the ruling Barisan Nasional (BN) votes in the next polls, Dr Mahathir said that while the Government needed a bigger amount annually to manage its growing expenses, by applying the business concept of “cost down”, Putrajaya could minimise wastage and improve efficiency.
“We must accept that the government needs more money with the passage of time. But should the increase be as big as it says?”
By paying attention to the yearly Auditor General’s Report on government waste, Dr Mahathir said:
“The Government often wastes money because it is not too concerned about the returns on its expenditure in whatever form… If the Government is interested in reducing the cost of governance, it can do so and perhaps quite substantially.”
For example, the Government could save substantially, more than 50%, if it opted for light-emitting diode bulbs, he added.
“The subsequent reduction in the amount of electricity to be generated will reduce subsidy on fuel for power. But this has not been done by the Government.”
He said while people understood that higher tax rates are necessary to cover the cost of development, the rise in living costs has to move in parallel with incomes earned.
“But the taxpayers cannot suddenly come up with the money to pay the new taxes and charges,” he said, adding that the cycles corresponds with the rising costs of doing business when wages, taxes and tariff are increased.
The effect on raising taxes must be carefully studied first, said Dr Mahathir. He proposed for a gradual increase in taxes, saying that it was a more viable option.
