In 1994/95, when you were the Finance Minister, Chapter 8, Prices Employment & Wages on Page 176, in the ECONOMIC REPORT 1994/1995, it states that 3.58 million EPF members earned income of below RM2,000 per month and some 73% are income earners below RM1,000 per month.
In 1995, EPF had 6.94 million members.
In 2013 when EPF had 13.6 million members, data from EPF showed that 62% of 6.4 million active contributing members earned less than RM2,000 per month while 96% earned less than RM6,000.
In its 2017 Annual Report, Bank Negara Malaysia (BNM) said the living wage, defined as the minimum income needed to be an active member of society and to be free from severe financial stress, was RM2,700 for an individual and RM6,500 for a couple with two children.
In Aug 2023, data from the Department of Statistics Malaysia (DOSM) on formal sector employees’ wages revealed that a significant 35% of workers earn less than RM2,000 a month.
According to the data, the number of formal sector employees earning below RM2,000 a month was over 2.2 million as of March 2023, followed by those earning between RM2,000 - RM2,999 at around 1.3 million people.
As the Department of Statistics says Malaysia's poverty line income is RM2,208, it appears that a substantial number of active EPF members are now living below this.
According to the then Deputy Minister of Finance, he said that as of Feb 2023, 6.7 million members or 51.5% of 13.1 million EPF members, have savings of less than RM10,000.
It is a real shame that almost 30 years later, in 2023, a majority of the EPF members still continued to earn less than RM2,000 per month.
It appears that the needle only inches a little for the last 30 years.
In fact, 30 years later, members of EPF are worse off.
Now they are witnessing a distinct narrative of a deterioration in their living conditions.
It clearly showed the country has never made any progress in resolving low wages in this country.
Apart from the workers being short-changed, what happened to all the economic transformation programs that aimed to propel the country to become a high-income nation previously?
How much did price controls, subsidies and the influx of cheap unskilled foreign workers contribute to real wages remaining low or stagnating?
Was the government aware of all the issues that kept real wages low and stagnating for the last 30 years?
Obviously, they are.
Institutions like Bank Negara Malaysia and Khazanah Research Institute have been highlighting these issues on several occasions for the last 20 years.
In fact, Bank Negara in their Report on Outlook and Policy in 2021 cited prevailing structural issues with the continued prevalence of the low-cost production model and high dependence on low-skilled foreign workers discourages productivity enhancements, depresses wages, and encourages the creation of low-skilled jobs, which are all untenable in the long-term for the country.
The country needs more than the Progressive Wage Policy that was rolled out recently.
The progressive wage policy cannot stand on its own.
Headline statistics showing consistently low unemployment and reasonable overall participation rates disguise more nuanced concerns regarding effective functioning.
Low unemployment is a by-product of having a very limited safety net.
The country must not lose sight of the necessity to implement important long-term structural reforms immediately.
Without this, the country’s aspiration of high-income living standards will remain a distant oasis. Hopefully, the newly appointed Minister for Human Resources will draw up an actionable holistic labour market policy framework to guide policymakers in building a robust labour market ecosystem.
The country has 5 Prime Ministers in between when you were the Finance Minister and now.
And none has done anything significant to move the wages of workers in Malaysia.
Some would argue the government implemented the minimum wage policy of RM1,200 in 2020 but that is still below the poverty line income of RM2,208 as defined by the Department of Statistics.
Now that you are the Prime Minister, you have the opportunity to do what 5 of your predecessors failed to do.
Otherwise, the country is staring at a lot of ordinary folks who will go into old age in poverty.
No wonder after spending more than RM500 billion, Talentcorp still failed in their attempts to persuade the 1.3 million Malaysians to return home.
Do you blame them for taking their talents elsewhere?
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