The Second Malaysia Plan 1970-1975

First of all, this House should note that we are not debating the Development Plan for the next five years, but for the next four-and-a-half years. Six months of this Five-year Second Malaysia Plan have already passed before this Plan comes before this House. This speaks most eloquently for the authoritarian nature of the present government, which professes democratic rule. What this House and co country think, feel and decide do not matter. The Alliance Government has decided, and this is that.

The Second Five-year Plan opens with this passage:

“National unity is the over-riding objective of the country…..This direction toward national unity and progress is fundamental to the New Economic Policy. The Second Malaysia Plan, based on this Policy, is designed to facilitate the achievement of the national objective”.

The first Malaysia Plan, 1966-1970, had also this same objective. In the words of the First Malaysia Plan, one of its main objectives was to “promote the integration of the peoples of Malaysia by embarking upon a development plan explicitly designated to promote the welfare of all”. The Second Malaysia Plan (Chapter II) speaks of the “successful implementation” of the First Malaysia Plan. If so, has its objective to promote the integration of the peoples of Malaysia succeeded?

We know the answer. The May 13, 1969 racial riots clearly point to the failure of the First Malaysia Plan “to promote the integration of the peoples of Malaysia, Apart from casting blame on Opposition parties – which it is not my intention to deal with – the Government also declared that the riots were partly cause by “the growing sense of insecurity felt by the Malays due to racial imbalance particularly in the education and economic fields”. I say this to show that although the First Malaysia Plan was claimed by the Government to have been successfully implemented, it did not advance national unity and integration. Similarly, we must not assume that the Second Malaysia Plan, if implemented successfully in the Government’s claim, will definitely promote national unity which the Plan has stated as the over-riding objective of the country. It has been said in this House during this debate that unless the Second Malaysia Plan is implement, there will be a greater May 13 racial riot, but this time it would be confined to Kuala Lumpur and would affect the whole country.

Mr. Speaker, Sir, the country was told that the May 13 racial riots were caused by opposition parties exploiting sensitive issues which are now entrenched in the Constitution and placed beyond the pale of public discussion. We are told that once these issues are declared sensitive and banned from public discussion and questioning, the country is safe from other May 13-type racial riots. Now, in this House we are told that if this Second Plan is not fulfilled, there will be bigger and more terrible May 13 riots throughout the country. And as I have just pointed out, since the so-called successful implementation of the First Malaysia Plan did not prevent the May 13 riots, a successful implementation of the Second plan is not likely to prevent a recurrence either. It would appear, therefore, that whether the Second Plan is successfully implement or not, the possibility of May 13 riots is always there. I do not see how the Second Plan by itself can create national unity, just as the First Malaysia Plan has failed to do. More than a Malaysia Plan, more than Rukunegara, is required to create national unity. Unless the Government and country take into fullest consideration all the inter-related social and cultural, political and economic, public and private, emotional and psychological factors of building a Malaysian consciousness and identity, by the end of the Second Plan, national unity will be as elusive as it is today.

The Plan incorporates a two-pronged policy for development. The first prong is to reduce and eventually eradicate poverty, by raising income levels and increasing employment opportunities for all Malaysians, irrespective of race. The second prong aims at accelerating the process of restructuring Malaysian society to correct economic imbalance, so as to reduce and eventually eliminate the identification of race with economic function.

We support both objectives. But going through the Plan, and listening to the speeches of Ministers all these months, after the New Economic Policy, one cannot help feeling that the first objective of eradicating poverty, irrespective of race, is only incidental to the central plank of the NEP(New Economic Policy): to restructure Malaysian society to correct racial imbalance. This view is strengthened by the unconvincing argument in the Plan that the two prongs of the New Economic Policy are not mutually exclusive, but interdependent and mutually reinforcing.

The poor of Malaysia are to be found in the traditional urban sector, where non-Malays outnumber the Malays by a factor of nearly 3 to 1, and in the traditional rural sector, where the position is reserved. The traditional urban sector covers small artisans, petty traders, hawkers, stallholders, household servants, trishaw-riders and other persons pursing a multitude of activities requiring little or no initial skill or training. The traditional rural sector comprises uneconomic smallholders rubber, single-cropped padi, traditional live-stock and other agriculture, gathering of jungle produce, inshore fishing and dulang washing and small gravel-pump mining for tin.

As is admitted by the Plan itself, the average incomes of both the traditional urban and rural sectors are low. And as has been admitted by the Government itself, in some ways the urban poor are much worse off than the rural poor, because unlike the latter, the urban poor own no land which they can fall back upon and which can at least be cultivated to enable them to obtain the necessities of life. The Plan itself admits that “the social and physical hardships of urban poverty are more severe than those of rural poverty.”

But if we look at the Second Malaysia Plan, we find that the emphasis of the programmes and projects are directed mainly at helping the rural poor, and the urban poor is left completely out in the cold. For instance, in the strategy for restructuring the economy, the following policies are laid down:

(1) Modernisation in the rural sector through the application of science and technology and bringing more new land under cultivation with modern techniques;

(2) Urbanisation, or the introduction of modern industries in rural areas and the development of new growth centres in now areas and the migration of rural inhabitants to urban areas;

(3) Increasing the participation of Malays and other indigenous people in urban-type activities in existing towns and growth centres;

(4) Creation of a Malay entrepreneurial community;

(5) Special measure to provide to Malays and other indigenous people business premises and physical facilities in existing urban centres.

Policies and programmes to eradicate poverty, the first prong of the New Economic Policy are:

(i) To increase the productivity and income of those in low productivity occupations through the adoption of modern techniques and better use of facilities.

(ii) To increase opportunities for inter-sectoral movements from low productivity to higher productivity activities in new land development schemes, fishing and forestry projects and in commerce, industry and modern services.

(iii) Provided a wide range of free or subsidised social services, such as public housing, subsidised rates for electricity, water and transportation, and medical services, improved educational opportunities and increased recreational and community services.

Any reader of the Plan cannot help but notice that the greatest pre-occupation seems to be to help the Malay rural poor, even if it means to the neglect of the non-Malay urban poor. I am not suggesting that it is wrong to help the Malay rural poor. What I want is that the Government must not ignore the plight of the non-Malay urban poor.

Foreign Economic Domination

Since May 13, 1969, the Government’s New Economic Policy has been obsessed with the concept of racial economic imbalance between Malays and non-Malays, strengthening the myth that all Malays are poor and downtrodden, while all Chinese and Indians are rich and wealthy. In actual fact, the overwhelming majority of the Chinese, Malays and Indians are poor. Furthermore, the real wealth of the country are not in the hands of the Chinese. The Plan confesses that foreign ownership and control predominate in the high-income modern sectors.

Padi farms are practically all owned by Malays. Of the total 4.2 million acres of land under rubber in West Malaysia, 37% are owned by Malays, 42% by non-Malays and 21% by foreigners. Three quarters of the oil palm and coconut acreages on estates in West Malaysia at the end of 1970 were owned by foreigners.

In 1969, of the total $4,678 million share capital 62.1% was accounted for by foreigners compared with 22.8% by Chinese, 1.5% by Malays and 0.9% by Indians. Foreign interests accounted for one-half to three-quarters of the share capital of limited companies in estate agriculture, mining, manufacturing wholesale trade, banking and finance. They also accounted for more than one-third of the share capital of limited companies in construction retail trade and other industries.

It is thus clear that there is in fact a great economic imbalance between Malaysians and foreigners in the ownership and control of wealth in the modern sector of Malaysian economy. When the Government talks about Malay economic imbalance, it is always compared to the non-Malays. I would want to know why the Government had never compared this to the foreign ownership and control wealth – which is more significant.

A continuous harping on the theme of Malay/ non-Malay economic imbalance, when in fact the majority of the Malays and non-Malays are poor, and the concentration of ownership and control of wealth in the modern economic sectors in the hands of the foreigners cannot do the country and the goal of national unity any good.


Until 1969, Government planners and economists had worried about ways and means to solve the acute unemployment problem in the urban areas, caused partly by the migration of some of the unemployed from rural to urban areas. It was then the Government policy to check the drift to the urban areas from rural areas, where the incidence of unemployment is lower than in urban areas.

For instance, the 1967-1968 Socio-Economic Sample Survey of Malaysian Household reported the incidence of unemployment in the metropolitan towns as 10.1% compared to the rural incidence of 5.4%.

Suddenly, under the New Economic Policy, the Government reversed its policy and is now encouraging the migration of rural inhabitants to urban areas, when the problem of urban unemployment is even more acute today than at any time before. We can understand if this new Government policy is the result of the solution of the problem of urban unemployment, leading to shortage of labour supply.

The situation is reported by the 1967-1968 Socio-Economic Household Survey, and I quote:

“It is significant that in 1962, the unemployment rate in terms of labour force for each of the major races in Malaysia, namely, Malays, Chinese and Indians was practically the same, viz: 6.0%.

“In 1967/ 68 this pattern changed and the increase in unemployment has been mostly concentrated among the Chinese and Indians. In fact, the unemployment rate among the Malays has gone down from 6.0% to 5.8% while that for the Chinese has gone up from 6% to 6.9%; for Indians there has been a significant increase in the unemployment rate from 6% to 10.3%.”

This is a Government publication, and not a DAP publication, and it was referring to 1967/ 68. The position now must have deteriorated.

With the Plan concentrating on the rural poor, and encouraging the migration of rural unemployed into the urban areas when the urban unemployed are not finding any jobs, the difference in the incidence of unemployment among the races are likely to widen. By encouraging rural migration without first solving the pressing and acute problem of urban unemployment, the Government is in fact condemning the urban unemployed to a worse fate, to a life of greater squalor, poverty and human indignity.

I call on the Government to reconsider, and stop encouraging rural migration of unemployed to the towns as a matter of deliberate policy, until the Government has first solved the problem of urban unemployment.

Paragraph 135 of the Plan states, and I quote:

“The Government has set a target that within a period of 20 years, Malays and others indigenous people will manage and own at least 30% of the total commercial and industrial activities in all categories and scales of operation. The Government has also stipulated that the employment pattern at all levels and in all sectors, particularly the Modern rural and Modern Urban Sectors, must reflect the racial composition of the population.”

Firstly, such a statement is meaningful if we know how much the Malays, the non-Malays, the foreigners own at present, and the estimate the Government has made of “commercial and industrial activities” in 20 years’ time. I ask for these figures and estimates to be given to this House, although I do not see how these can be available with the data as existing in our country.

Secondly, since a comprehensive programme of expropriation from foreign companies seems to be the only way to reach this objective, given the built-in reluctance of the Government to deal harshly with the Chinese tycoons who are either Alliance members or open Alliance sympathizers, I ask the Government to state whether it is seriously considering such a move.

And thirdly, given the Government stipulation that the employment pattern at all levels and all sectors, particularly the modern rural and modern urban sectors, must reflect the racial composition of the population, I ask the Government to state whether this policy will be implemented with regard to the new FLDA schemes and other land schemes to be opened up, and the new Army recruitment of personnel.

Mr. Speaker, Sir, the Plan can only works with the active support of the people. To get active popular support, the aim must be to restructure Malaysian society, and not just Malay society, and to eliminate all Malaysian poor. We have to restructure not only the Malay poor in the rural areas, but also to restructure the non-Malay poor in the urban slums and squatter settlements, by raising their income levels and earning capacities.

Felda Scheme

I have a lot of reservations that the lot of the Malay rural poor are going to be radically changed by this Second Malaysia Plan. Let us take the Government’s much-vaunted FLDA schemes. I have visited some FLDA schemes, and can speak from a little experience.

Through the Press, radio and television, we are constantly reminded that the FLDA schemes are a great success, and that the settlers are a new breed of middle-class Malaysia peasantry, earning $300 to $400 a month. It is true that on paper an average FLDA settler can earn about $300. But after they had made monthly repayment and for the Government for the settlement and for the food for the first few years of settlement, the overwhelming majority had less than $100 a month nett. There are even cases where, after all the monthly deductions, a settlers was reduced to $20 or $30. On top of these Government repayments, the FLDA settlers have also to pay development tax.

What is more mystifying is that FLDA settlers have the universal complaint that they really do not know how much money they owe the Government, for how long they must continue to repay the Government. Why is it the Government refuses to let every FLDA settler to have a statement of his debts? Are FLDA settlers to owe the Government for 15 years, 20 years, or for life? And what are the rate of interests charged?

The FLDA also act as middleman for the settlers. They compulsorily buy up the rubber, palm oil and other product of the settlers, and sell back provisions and foodstuffs and other daily wants. Invariably, there is the complaint that the FLDA pays for the settlers’ produce at lower than market price, and sells them provisions at higher than market price. This is clearly exploitation by a Government middleman, both inefficient and rapacious.

Mr. Speaker, Sir, the FLDA schemes are not such great success as the Government propaganda machinery wants the country and the visiting foreign dignitaries to believe. There is considerable mismanagement and maladministration in FLDA schemes. I call for the setting up of a Committee to visit all the FLDA schemes, to listen to the complaints of the FLDA settlers, and the elimination of the practice of buying from FLDA settlers produce at a cheaper price and selling them provisions at a higher price, when compared to market price outside the FLDA schemes.

Mr. Speaker, Sir, I am not convinced that the FLDA way is method to build up a prosperous peasantry – for we must not only create a new small class of the new rich, we must also look after the mass of peasantry who remain mired in their poverty, backwardness and squalor.

Of new land development, about 750,000 acres will be developed in West Malaysia between 1971 and 1975 according to page 133-4 of the Plan and the break-down is as follows:

1. From FLDA  – 275,000 acres
2. Private sector  – 112,500 acres
3. Joint ventures: Private Sector and Public Bodies. – 50,000 acres
4. Youth schemes –  75,000 acres
5. Public sector estates – 50,000 acres
6. Fringe alienation – Rehabilitation schemes – 16,000 acres
7. FELCRA new development schemes – 40,000 acres
8. New Block Planting – 150,000 ‘’
A total of about – 750,000 acres

However, from the point of view of providing owner-occupation to rural small-holders, we ought to omit number 2 and 5 above – perhaps also number 3 above – since they will not provide farms for the farmers, merely jobs. Thus, at the most 600,000 acres will be developed as new smallholdings for the farmers and, if we also omit number 3 above, only 550,000 acres will be developed as new farms. Of all these, there are a few points to bear in mind:

(1) In 1958, the FLDA Annual report estimated that there were 200,000 outstanding applications for land in Malaya. In 1960, The FLDA Annual Report estimated that on average, some 40,000 new families would be added to the population each year, and that not less than one quarter of which must be absorbed into agriculture. At 10 acres a family, the FLDA calculated that 10,000 families will need 100,000 acres of land each year. It is estimated that it would have to develop 50,000 acres a year as it seemed unlikely that the normal processes of land alienation would exceed 50,000 acres.

On its own estimate of 1960, the FLDA would have to resettle 100,000 in the last decade just to keep up with the natural rural increase without solving the backlog of land requirements. Since its inception in 1956, the FLDA has developed 308,400 acres and settled 20,700 families on 90 schemes.

Thus, during the last decade, the FLDA could only cope with 20% of its own target set in 1960, without tackling the problem of the huge backlog, which has further increased and therefore would seem more and more soluble.

The natural increase must have increased in the past decade, say, to 11,000 families per year. If we accept 10 acres as being the approximate size of an economic and viable holding, 110,000 acres of new land must be developed annually, or 550,000 acres per Five Year Plan, just to accommodate the rural population increase and without making any improvement to overcrowding in established settlement areas. Thus all the FLDA expansion of the Second Plan will not nearly accommodate the likely increase in rural population and the total planned new land development will only just about do it.

(2) The other schemes, namely number 4, 6, 7 and 8, I referred to above, will provide very much smaller farms than FLDA schemes. Fringe alienation schemes are usually 3-4 acres and the others 5-6 acres. Whilst the possession of 5 acres or so is obviously an improvement on landlessness, on what grounds can it possibly be argued that 5 acres are sufficient for the encouragement of a prosperous peasantry? How does the possession of a mere 5 acres or so become – and I quote from the Plan – “a genuine dynamic force for agricultural and economic development”? (page 43, para 142). Does it really make a reduction in economic imbalance?

(3) In view of the urgent need for more new land development, can the country afford the luxury of FLDA development costs will show the following: the Plan period 1956-60, where there were 1,700 new settler families covering an acreage of 17,000 acres, the development expenditure was 7.2million. in 1960-65, where there were 7,800 new settler families covering an acreage of 116,500 acres and the total development expenditure was $99.3 million. For Plan period 1966-70 there were 11,900 new settler families covering an acreage of 179,000 acres, at an estimated development expenditure of $305.0 million. In other words, from this Table, development expenditure per family has increased from $4,235 in 1956-60 to $25,630 in 1966-70 and development expenditure per acre from $423 to $1,703.

Some questions thus become relevant:

(1) Why have costs increased so much?

(2) Cannot ways be found to reduce costs? For example, can’t we make less use of contract labour as in 1955-60, and more use of settler labour as on other schemes, particularly Youth Schemes and SEDC Schemes?

(3) In view of the high cost of repayment by the settler and interest charges, where many FLDA settlers can hardly make $100 per month nett, is $25,000 a good investment if returns are so low?

(4) Has FLDA outlived its usefulness or has it been elevated to position of providing projects only?

Mr. Speaker, Sir, the problem of landlessness is a pressing one. The landless should be given land, on the condition that they open up and cultivate them without all the formalities and the red tape which attend them at present. If we are going to wait for the FLDA to spend $25,000 on a settler, there will never be a solution to the problem of landlessness. Malaysia is rich in land, with 30 million acres suitable for agriculture. I, therefore call on the Government to embark on a liberal land policy by giving land to the landless. In this regard I must call for the immediate, unconditional release of peasant leader, Hamid Tuah, who is under political detention under the Internal Security Act in Batu Gajah for championing the cause of the landless. In fact the Government, if it cares for the rural underclass, should enlist the services of Hamid Tuah to try to solve the Problem of landlessness instead of incarcerating him. Hamid Tuah’s detention is testimony of the anti-peasantry character of the Government.

Mr. Speaker, Sir, we have read and heard a lot of ministerial pronouncements about agrarian reforms to improve the lot of peasants, for example, double cropping from schemes like the multi-million dollar Muda irrigation Scheme, agricultural extension programmes, agricultural credits, subsidised fertilizers, free seedlings, farm implements, improved market outlets for the produce, co-operatives, etc. But has there been any study to find out who have actually benefitted from these government programmes? Is it the higher rural strata, the landed interest, or the farmers, tenant operators and farm-hands?

I believe a study will show that the people who benefit most are the landed interests, because they are the ones who could better benefit from the advantages offered by the co-operative institution and Government subsidies. The net effect is to create more not less, inequality in the rural areas. For instance, I have been told that as a result of the Muda Irrigation Scheme double-cropping the padi fields, many tenant padi farmers have lost their tenancy and pushed down further into poverty and indebtedness. With double-cropping, the landlords prefer to pool their resources, buy modern machinery, hire farm hands, and reap great dividends without any exertion or effort on their part. The tenancy legislation which has been on the statute books for a decade to protect tenant farmers is as good as dead. The Government should see to it that some of their programmes, whose motivation is to benefit the rural masses, do not end up aiding the better-offs only. Every farmer should have his own plot of land which he possesses and farms.

The Government says that the per capita income of Malaysian have increased from $928 in 1965 to $1,020 in 1970. I do not think that Malaysians in the street are going to agree with the Government that they have more money in their pockets. On the contrary, they will feel that they have less purchasing power, with the spiraling increases of prices of essential commodities and goods. The peasant who earns $40 a month and if he has a family of five inclusive of himself his capita income will be $96, is not going to be very impressed either. Nor even the FLDA settler, who is supposed to be in the modern agricultural sector, for with a family of five, and with his net monthly income less than $100 his per capital income will be less than $200.

Retention of Jobs

The point that I wish to make here is that it is no use talking about Malaysia being the third Asian country with the highest per capita income when the common man and woman in the kampong and the urban slums could not find a square meal, when poverty oppresses, degrades and humiliates. Economic growth and prosperity must be translated into personal terms for every Malaysian, particularly the poor.

Despite the growth of the economy, the incidence of unemployment has increased. When the First Malaysia Plan was implemented, it was estimated that the rate of unemployment was 6% of the labour force. One of the Plan’s objective was to reduce this rate of unemployment to 5.2% by the end of the Plan in 1970 by the creation of 380,000 new jobs in West Malaysia.

The Second Malaysia Plan gives the unemployment rate in 1970 as 8%, although the Minister of Finance, in his 1971 Budget Speech, gave the figure as 9% last year. I am inclined to think that the Government figure is a deliberately low one. So, instead of reducing unemployment the First Plan has actually increased unemployment and just now we have just heard from the Minister of Labour commending the Government of this great achievement!

This is a very serious problem, as a feature common to both urban and rural unemployment is the high incidence of unemployment among the younger age-groups, particularly between the ages of 15 to 24 and among school-leavers. In 1962 this age group constituted 63% of the total unemployment, but by 1967/68, is has grown to 75%. This is a problem to which the Government must give top priority and urgency, for otherwise it holds the seed for social unrest and national strife.

A study of the first and second Malaysia plan shows that they give different employment levels from 1965 for the manufacturing sectors. The First Malaysia Plan page 53, for instance, gave the following figures:

1965 (Actual) Projected for 1970 Projected Increase
173,000 jobs 209,000 jobs 36,000 jobs

For the Second Malaysia Plan, page 98, the figures are:

1965 (Actual) 1970 (Actual) Projected Increase
217,000 jobs 270,000 jobs 53,000 jobs

It can be seen that there is a big difference between the two estimated. In fact, the difference – 44,000 – is bigger than the projected increase in the first Malaysia Plan. Can the Government explain the discrepancy in view of the great importance placed on this sector of Government policy?

It is noted that the Second Malaysia Plan has projected an increase of 10,000 jobs for this sector. This is an unprecedented rate of 7% increase. The optimism is based on the 415% per annum increase obtained over 1965-70. While not under-estimating the capacity of this sector to grow, it is important to know whether the increase in jobs over 1965-70 was a genuine increase or an increase brought about by using a different set of definitions. This is not a quibble. In the Mid-Term review of the First Malaysia plan, the figures given are in line with those of the First Malaysia Plan. In fact, fears were expressed that the target of 36,000 might not be achieved in page 63. How is it that between 1969 and 1971 the data were changed? If data can be altered so easily and without explanation, how can we accept any figures given in the Second Malaysia Plan?

The employment strategy consists, among other things, according to page 103 of the Second Malaysia Plan, of:

(i) expended economic growth, and

(II) increased use of labour.

It is stated that “the first component of the employment strategy of the Plan is the promotion of rapid economic growth”. In other words, it is assumed that employment growth will accompany economic growth. This is highly questionable.

Experience in other developing countries show that the above assumption is only true to a very limited extent. Over the past twenty years, unemployment has become more serious in spite of general uplift of economic activities. The same pattern is true whether we look at fast-growing countries like Mexico or slow-growing country like India. The pursuit of rapid economic growth has often meant concentrating on a few capital-intensive industries with the emphasis more on productivity than on employment growth.

Paragraph 19 of the Second Malaysia Plan claims that the Government is going to use, and I quote, “deliberate efforts … to use more labour-intensive techniques”. Does this mean:

(a) either that the Government is going to encourage those industries which happen to be labour-intensive by their very nature?; or

(b) that the Government is going to encourage all industries to adapt their present techniques in order to make them more labour-intensive?

This distinction is important. For instance, industries which are inherently labour-intensive can also be efficient growth industries, but industries which are not inherently labour-intensive tend to become less efficient if required to absorb more labour. The correct industrial policy should be (a), but the statement in the Plan suggest the Government is festering (b).

In view of the importance the Government is placing on industrialization, it is strange why the Government is allocating a minute sum of $23 million for industrial estates in 1971 to 1975 as it also did in 1966 to 1970. It is note-worthy that Singapore managed to spend $264 million in 1966 to 1970 just for industrial estates.

There does not seem to be any plan to solve unemployment. Perhaps, the true answer can be found in paragraph 322 and I quote:

“However in the interim, it is an essential requirement of the strategy towards achievement of a full employment economy that the attitude, productivity and cost of Malaysian labour be such that they encourage entrepreneurs both local and foreign, to invest here. It is largely through such investment that the necessary increases in labour demand will be generated.”

To paraphrase this fortuous passage in the Plan, the précis is this: We need investors, so says the Plan. They give jobs. But they will only invest if labour is cheap. And so, we will keep unemployment at the present level, so that wages won’t go up.

I cannot believe that the Government has this as a matter of policy. I cannot believe that our country will tolerate such things. Our country is rich enough to make full employment a reality. Even if we cannot do so, it will be fair better to face organized labour and ask it for restraint. This will be an infinitely much more human approach than to deliberately keep some 300,000 workers unemployed.


No development plan can work, unless the Government leaders and administrators are renowned for their competence and integrity. We know that corruption is an obstacle to the economic development of the country. Although the Government has set up the Anti-Corruption Agency, which is a Step in the right direction, the problem of corruption remains as rampant as ever. The most intractable problem is corruption in high places. Unless efforts are directed towards punishing corruption of those higher-ups as Ministers and higher officials, big bribers in the business class, the disease of corruption all the way down will be protected. We have been repeatedly told and promised that the Anti-Corruption Agency will be going not only for the small fries, the ikan bilis but also for the sharks, the ikan yus.

What has the Anti-Corruption Agency to show for this? Are we in the country to believe that corruption takes place only at the lowly levels of Government Service while in the high and mighty places, saintliness, incorruptibility and dedication to public service is the order of the day? If the Director of Anti-Corruption Agency will care, provided he has the power to investigate into the cases of every politician and ex-politician at both state and Federal levels, compare his income and wealth before political success and his wealth and income and that of his next of kin today, I am sure he will have ample material to occupy him for years.

In Malacca last year, the public were told through the mass media that the Corruption Agency had landed a number of sharks who occupy high and political places, their bank accounts have been frozen and proceeding taken. But the news was too good to be true. The whole matter fizzled out. I would like to ask what has happened to these fishes and sharks in Malacca which the Anti-Corruption Agency had in its net early last year. Have they escaped and now they have been allowed to escape?

Mr. Speaker, Sir, corruption must be ruthlessly stamped out without fear or favour, if we are going to have a clean, honest and efficient Public Service to carry out development projects for the people and country. Just as Government servants can be corrupted by money, bribery and other forms of material inducement to betray the public trust and confidence placed on them, in the same way. Members of Parliament and State Assemblymen can be corrupted by money and material inducement, like mining leases, land titles, economic opportunities and other temptations to betray the public trust and confidence places on them by the people during the General Election by switching parties. This is political corruption, which debases politics as the highest and most honourable and noble public calling for citizens to dedicate themselves to serve the public and country, it is such form of political corruption which breeds the mentality and atmosphere of corruption in the country and Public Service.

If corruption in the Public Service is to be stamped out, political corruption must also be stamped out. Members of Parliament and State Assemblymen must not be allowed to betray the confidence of the electorate and the trust of the party on whose ticket they were elected by switching parties because of mere material and other inducements. This can be done by the enactment of a law which requires every Member of Parliament or State Assemblyman who resigns from the party on whose ticket he was elected to vacate his seat causing an immediate by-election. If the defecting M.P. or State Assemblyman has defected for good, honourable public reasons, he should find no difficulty in getting an endorsement and re-election by his electorate. On the other hand, an M.P, or State Assemblyman who defects for mere personal gain will be rejected and repudiated by the electorate. I commend such a law to the Government which will not only cleanse politics of all its corruption and immorality but will also set the right tone for the elimination of corruption in Malaysia.

(Speech by Member of Parliament for Bandar Melaka and DAP Secretary General, Lim Kit Siang on The Second Malaysia Plan in the Dewan Rakyat on July 14, 1971)