It has already been stated that the Pangkalan Data Utama (PADU) socio-economic database, for which registration ends on March 31, will be used as a key component in how the government retargets subsidies and assistance.
However, only around nine million people out of a possible 30.08 million have registered their details as of this week, and the low registrations may make it challenging for the government to target subsidies accurately. Economy minister Rafizi Ramli reiterated the point earlier this week, saying that low numbers might not allow the government to move forward with its plan.
Despite this, the government’s noble intention of helping the poor should not be derailed just because some people have not registered under PADU, say academics. According to Tan Sri Noor Azlan Ghazali, the director of Universiti Kebangsaan Malaysia’s Malaysian inclusive development and advancement institute, the two issues should not be tied together, as The Star reports.
“It is important for the government to separate the two issues of filling in the PADU system and targeted subsidies. It is not right when many do not receive their eligible subsidies or cash handouts just because they did not fill in their details in PADU,” he said.
He added that in handing out cash as assistance to the poor, it was important for the government to not simply celebrate the number of recipients who will receive cash handouts and subsidies, and that it should also look at increasing the recipient’s capacity to boost their future income.
“This means that with the transfer of a cash handout, recipients are also told to register at nearby training institutes or community centres to enable them to get skills training that could help them in raising their income.” he explained.
“The question is, are there people who have done better in their lives and come out of the cycle of poverty? For now, we are informed that there are about eight million recipients who are eligible to receive cash handouts and subsidies. If each has three dependants, that would come up to more than 24 million people,” he said.
Meanwhile, economist Tan Sri Lin See Yan said the government needs to get its formula right on what defines the poor before it implements targeted subsidies. The former Bank Negara Malaysia deputy governor said that without the right formula, targeted subsidies would be a failure as they would not reach relevant groups.
Additionally, Sunway University professor of economics Yeah Kim Leng said a good formula must be easy to administer so that costs are kept to the minimum, and that there are minimal leakages and inclusion/exclusion errors.
While a timefrane for targeted subsidies has been indicated (for RON 95 petrol, in the second half of this year), the government has not yet announced its mechanism and how these subsidies will be dispensed, although it is said to be mulling using using monthly cash transfers as a means to disburse financial aid to those who qualify for it.
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