Speech by Ketua Pembangkang and DAP Secretary-General, Mr. Lim Kit Siang at the 7th Anniversary Dinner of the Perak DAP held at the St. John’s Ambulance Hall, Ipoh, on Saturday, 6th October, 1973 at 9.00 p.m.
Three Proposals to fight galloping inflation in Malaysia
In the last 2 years, inflation has become the most outstanding problem for the people of Malaysia.
Price increases of all goods keep chasing one after another, some shooting up by more than 100% increase, while the purchasing power of the Malaysian dollar in the hands of the housewives and consumers continue to fall.
Inflation is highly inequitable and unjust as it bears heavily on those getting low and fixed incomes, thus widening the gap between the haves and have-notes.
It is regrettable but true that for the last 2 years, the Alliance Government has failed to work out an effective strategy to fight inflation. The Alliance Government appeared to be completely helpless in the face of rising prices for all consumer products. In actual fact, it will be more correct to say that the Alliance Government does not have the will or determination to combat inflation. This is because while the majority of the people suffer from price inflation, there is a tiny minority which makes huge “windfall” profits from it. And it is this tiny minority of people who have traditionally formed the financial backbone of the ruling party.
Inflation can be brought under control, not by words, speeches and statements but only by firm and purposive government action.
I want to make 3 proposals to combat inflation in the country:
1. Cutting down Government expenditures
The Government should order a stop to all prestigious but unproductive public expenditure, which can only fan the inflationary spiral in the country. A good example is the multi-million dollar Senai International Airport in Johore at the centre of 2 established International airports of K.L. and Singapore. Another example which comes easily to mind in Perak is the sending of Alliance and National Front Members of Parliament and State Assemblymen on pleasure trips overseas disguised as study tours. The Prime Minister should ban all such overseas pleasure trips especially during the present difficult period of inflation.
2. Raising the Productivity in all walks of economic life
The increase in the overall economic productivity in both public and private sectors will help to stabilize prices and check inflation. Waste, inefficiency, incompetence and corruption on all economic fronts should be ruthlessly stamped out.
That the Government itself has a long way to go to become an efficient economic organization can be seen from the mess created by the LPN over the rice situation. Within a short period of 4 months, the LPN landed Malaysia in 2 rice crisis of shortage and high prices despite the fact that we produce 90% of our needs.
3. Review the entire taxation policies of the Government which have an inflationary influence on the economy
Tun Tan Siew Sin’s taxation measures have clearly contributed to the galloping inflation in the country. This is especially the case with the 5% Sales Tax which has been admitted by no less an authority as the Bank Negara in its recent annual report.
The Finance Minister should instruct his Treasury officials to study the extent the 5% Sales Tax has contributed to the inflationary spiral in the country.
In another 2 month’s time Tun Tan Siew Sin will be presenting his Budget for 1974. He would be well advised to take the opportunity to scrap the inflationary 5% Sales Tax altogether.
It would be a good idea for all Malaysian organizations and individuals who want a repeal of the 5% Sales Tax to make use of the time from now till Budget Day to make representations to the Finance Minister to impress upon him the degree of unpopularity of the 5% Sales Tax, and the depth of hardship it has caused to the poor.
I have no doubt that if the above 3 proposals are accepted and put into practice, together with firm Government action against unjustified price increases, we would be taking a long step towards controlling inflation and restoring to consumers and housewives the full value of the purchasing power of the Malaysian dollar.