Attempt to measure civil performance is not new in Malaysia. They have the annual performance evaluation to measure where the employee stand in terms of productivity, creativity, initiative etc. It is no different from the private sector. It is reported today that the govt want to introduce KPI as an added tool to separate the performers from the non performers. It is definitely a good measure if they could identify the various outputs/services as target for each employee. It is a difficult task because it is not just about quantity, which in itself in the service sector is not a tangible measure, but also about looking at customer satisfaction. How do we obtained the indicator of customer satisfaction? Perhaps from surveys or complaints submitted!
The proposed measure require a radical change in the employment terms of civil servants. Top management could perhaps be recruited from the private sector on contract basis, that should include engineers in JKR, IT staff in various dept., and various categories of civil servants in the local authorities. Without this changes KPI will just add to the workload.
Friday, June 25, 2004
Thursday, June 24, 2004
MAS: privatisation gone bad
Malaysian Airlines is a classic case of privatisation gone bad. It all started with its flotation exercise in 1985 resulting in the govt offering its shares to the public while retaining control. Following the flotation exercise the company was able to reduce its debt and obviously quite attractive for a takeover. A new owner bought it from the govt at RM 18 per share and a few years later it accumulates sufficient debt to go under. The govt has to bail it ought by buying back the shares at the same price it was sold. Nobody in the financial market understand the business logic of the Malaysian govt: many attribute it to cronyism at its best. The Minister of Finance then argued in Parliament that the rescue is necessary because of national interest and the company's future prospect justify the value paid for by the govt. In Malaysia, the culture is, the govt action is always in the interest of the public, and if they have been wrong they would not have been reelected.....so it goes on and on with criminal practise with impunity.
MAS has always presented the view that the domestic operations is a loss contributor until Air Asia emerged in the domestic aviation scene.
Suddenly they sing a differenttune.
MAS has always presented the view that the domestic operations is a loss contributor until Air Asia emerged in the domestic aviation scene.
Suddenly they sing a differenttune.
Monday, June 21, 2004
Acting rich: every household has a maid
Malaysian generally live in luxury: many own expensive cars,many own more than one car,and according to local newspaper there are 250,000 domestic helpers to assist them in their lifestyle. This figure represent only the maids that are legally registered with the immigration dept.
If you go to richer countries like Australia, US, UK or any European country, you either can't afford it or the govt will not allow the luxury of importing these kind of labours.
In three months time, it was reported, the Human Resource Ministry will set up training program to train locally source domestic helpers and put them in a more organised labour market. This is a long overdue measure and at the same time the govt must discourage the employment of foreign domestic help by Malaysians. This will save the country huge foreign exchange leakage and in the process help strenghten our economy. Malaysians themselves must change their lifestyle: live in houses that is easier to maintain, send kids to neighbourhood schools, organised better day care nurseries (perhaps employers and govt could collaborate on its establishment).
In three months time, it was reported, the Human Resource Ministry will set up training program to train locally source domestic helpers and put them in a more organised labour market. This is a long overdue measure and at the same time the govt must discourage the employment of foreign domestic help by Malaysians. This will save the country huge foreign exchange leakage and in the process help strenghten our economy. Malaysians themselves must change their lifestyle: live in houses that is easier to maintain, send kids to neighbourhood schools, organised better day care nurseries (perhaps employers and govt could collaborate on its establishment).
It is also time to slow down our construction driven economy so that we can get rid of many foreign construction workers. The govt plan introduction of prefab houses to reduce dependency on foreign labour is also a timely move.
If you go to richer countries like Australia, US, UK or any European country, you either can't afford it or the govt will not allow the luxury of importing these kind of labours.
In three months time, it was reported, the Human Resource Ministry will set up training program to train locally source domestic helpers and put them in a more organised labour market. This is a long overdue measure and at the same time the govt must discourage the employment of foreign domestic help by Malaysians. This will save the country huge foreign exchange leakage and in the process help strenghten our economy. Malaysians themselves must change their lifestyle: live in houses that is easier to maintain, send kids to neighbourhood schools, organised better day care nurseries (perhaps employers and govt could collaborate on its establishment).
In three months time, it was reported, the Human Resource Ministry will set up training program to train locally source domestic helpers and put them in a more organised labour market. This is a long overdue measure and at the same time the govt must discourage the employment of foreign domestic help by Malaysians. This will save the country huge foreign exchange leakage and in the process help strenghten our economy. Malaysians themselves must change their lifestyle: live in houses that is easier to maintain, send kids to neighbourhood schools, organised better day care nurseries (perhaps employers and govt could collaborate on its establishment).
It is also time to slow down our construction driven economy so that we can get rid of many foreign construction workers. The govt plan introduction of prefab houses to reduce dependency on foreign labour is also a timely move.
Sunday, June 20, 2004
Driving crazy2
Mingguan Malaysia on 20 June reported the total number of motor vehicle registered in Malaysia is 14.3 million units. Forty percent of the vehicles are motorcyles and the balance of about 8 million are cars. With growth of new vehicle registered at about 6 percent per year we will soon be running out of roads and space. The demand for roads according to economist is an inverse function: it grows even though the average cost of using the road is higher. It will reach equilibrium when the demand intersect with the average cost of road usage. To discourage this unhealthy growth the economist will say price the road usage at marginal social costs, which is much higher than the average cost. The concept of externality take into account the external costs such as pollution and congestion into account, whose costs are external to that of the car owner.
Even at the current average cost of using a car in Malaysia, already quite high relative to the services offered in return, the govt has collected substantial sum without putting it back to the motorist. Just assume that the average road tax per vehicle is RM200 per annum and multiply it say with 10 million vehicles, the road tax revenue per annum will amount to about RM 2 billion. This exclude the other charges that the car owner must bear: with excise duty on petrol your total cost grow with the mileage you travel. There are also duty on parts and tyres and also the progressive rate of excise duty on vehicles at time of purchase. If the govt collect say RM 10 billion in revenue from car owners per year and put it back in expenditure of only RM 2 billion, and the bulk of it goes to toll highway concessionaires, then the govt has robbed the poor to give it to the rich. On the average motorist also incur additional charges of, on the average, RM 200 toll per month. Imagine how much car owners has to pay year in year out to the rich concessionaire holder, usually described as cronies,who cheated consumer by building highway at inflated costs.
Even at the current average cost of using a car in Malaysia, already quite high relative to the services offered in return, the govt has collected substantial sum without putting it back to the motorist. Just assume that the average road tax per vehicle is RM200 per annum and multiply it say with 10 million vehicles, the road tax revenue per annum will amount to about RM 2 billion. This exclude the other charges that the car owner must bear: with excise duty on petrol your total cost grow with the mileage you travel. There are also duty on parts and tyres and also the progressive rate of excise duty on vehicles at time of purchase. If the govt collect say RM 10 billion in revenue from car owners per year and put it back in expenditure of only RM 2 billion, and the bulk of it goes to toll highway concessionaires, then the govt has robbed the poor to give it to the rich. On the average motorist also incur additional charges of, on the average, RM 200 toll per month. Imagine how much car owners has to pay year in year out to the rich concessionaire holder, usually described as cronies,who cheated consumer by building highway at inflated costs.
Sunday, June 13, 2004
Non bumi to head glc
The govt have decided to recruit capable non Malays to head the glc, perhaps to inject new culture in the corporations, so that it is capable of surviving global competition if there is such a thing. However this is not a new initiative. The first CEO at MISC and MAS was ethnic Chinese, and the appointment was never controversial then. Later we have colourful corporate figures like Abdullah Ang and Eric Chia who were appointed to lead govt companies and the outcome was disastrous, and both were shady character even prior to the appointment. Later when some govt companies was privatised, the Malay management was cleaned out (some called it ethnic cleansing), although nominally the shareholders was majority owned by the Malays. These companies have since been bailed out by the govt. The key to successful public enterprise management does not only depend capable manager, irrespective of race, but also on the integrity of the manager. Their ability to manage must not be compromised by political interference.
The Minister also demands that non Malay firms, especially those listed on KLSE, not to discriminate against the Malays in their recruitment, and this is highly contentious. It will take a long time before attitude and prejudices of the Chinese towards the Malays changed. It may take a least one generation for the change to take effect, and that must start from the school system. Secondly the Malays, should have pride not to accept position as stooge especially as director, who sometimes not even aware that they have been used for illegal activities like related party transactions etc. Professional firms like the accounting firms, normally affiliated to international firms, are the worst practisioner in what the Minister described as tokenism. A firm like Price Waterhouse Coopers is noted in making sure that the Malay trainee is demotivated and eventually leave the firm, and quickly confirm that the Malays cannot work under pressure. This problem is a vicious circle. Only a strong political will can break this practice of demolishing the Malay professionals right in the bud.
The Minister also demands that non Malay firms, especially those listed on KLSE, not to discriminate against the Malays in their recruitment, and this is highly contentious. It will take a long time before attitude and prejudices of the Chinese towards the Malays changed. It may take a least one generation for the change to take effect, and that must start from the school system. Secondly the Malays, should have pride not to accept position as stooge especially as director, who sometimes not even aware that they have been used for illegal activities like related party transactions etc. Professional firms like the accounting firms, normally affiliated to international firms, are the worst practisioner in what the Minister described as tokenism. A firm like Price Waterhouse Coopers is noted in making sure that the Malay trainee is demotivated and eventually leave the firm, and quickly confirm that the Malays cannot work under pressure. This problem is a vicious circle. Only a strong political will can break this practice of demolishing the Malay professionals right in the bud.
Friday, June 11, 2004
Driving crazy
Driving around Kuala Lumpur is getting more stressful. It is also true in other towns in Malaysia. Congestions grow everyday as a result of rapidly growing car population. This is despite the fact that cost of car ownership and its operating expense is one of the highest in the world. As to why car prices is so high compared to Japan or Korea, the adviser to Proton said it is to discourage more people from using cars . "He also defended the government's high taxes that made cars in Malaysia more expensive than those in Japan and South Korea, saying it was partly to prevent traffic jams."
The total new car registered annually is about 450,000 or say about 35,000 per month. If the average length of the car is about 5 meters and if half of the newly registered car s are on the road at any given time on any day, it will add approximately 50km long of cars monthly. Where will this end?
Just before the recent general election a group of high school students were interviewed by New Straits Times on what they expect their newly elected govt to do for them. One student answered that she would like to see the govt provide better public transportation system. I wonder if our current political leaders are as savvy as this young lady. I personally feel that this is a priority if the overall health of the economy is to be preserved. The first step is to divest Proton because it sucks the economic resources of a small country like Malaysia. Proton car prices is so high not because it want to save Malaysia from congestion and pollution, but to fulfill the dream of its founder. You don't have to be an economist to know that, to remain in business it must be profitable and that is why Proton is having relatively huge cash surplus: the subsidy from the public. Even a world clss partner of Proton, Mitsubishi, cannot achieve the same feat.
The total new car registered annually is about 450,000 or say about 35,000 per month. If the average length of the car is about 5 meters and if half of the newly registered car s are on the road at any given time on any day, it will add approximately 50km long of cars monthly. Where will this end?
Just before the recent general election a group of high school students were interviewed by New Straits Times on what they expect their newly elected govt to do for them. One student answered that she would like to see the govt provide better public transportation system. I wonder if our current political leaders are as savvy as this young lady. I personally feel that this is a priority if the overall health of the economy is to be preserved. The first step is to divest Proton because it sucks the economic resources of a small country like Malaysia. Proton car prices is so high not because it want to save Malaysia from congestion and pollution, but to fulfill the dream of its founder. You don't have to be an economist to know that, to remain in business it must be profitable and that is why Proton is having relatively huge cash surplus: the subsidy from the public. Even a world clss partner of Proton, Mitsubishi, cannot achieve the same feat.
Thursday, June 10, 2004
Currency Choke
It was the title of Philip Bowring article on Asia's currency published in New Straits Times on Wed, June 9. No url is available for me to link it to. It also covers the Malaysian currency which he said is also in need of revaluation. The exchange rate in Malaysia, like that of other Asian countries, is a barrier to consumption led growth which the country needs.
He observed that with the rising oil price, which is denominated in USD, has caused alarm to Asian countries although, he said, it is less felt by Malaysia. I think Malaysia is also not spared by the oil price increase, despite having own petroleum resources, because the oil is in USD and that is the world market price. If you are a buyer you have no choice with the price and if you are the seller you will not sell it at lower than market. It will definitely be translated into higher fuel cost for Tenaga, airlines operator etc, and perhaps it will result in less revenue for the govt if retail prices of petroleum products is not revised upward. With the lower exchange rate the impact on domestic price is exarcebated. Also Malaysia imports a lot of foodstuff for public consumptions and the exchange rate affect the cost of living of ordinary Malaysian. Since the introduction of exchange rate pegging domestic prices has been rising and it will be a matter of time before it will explode into a political issue.
Also in the letter from a reader entitled "Don't rush to open medical schools" he said the availability of sufficient quality lecturers has been a problem since the establishment of the first medical school (at Universiti Malaya). He said the ringgit then was good value for the international recruitment. Obviously it is even more unattractive now for prospective foreign lecturers to offer their services, even if pay is tripled that of the local lecturer.
Our high value added exports are not the manufacturing products but continue to be contributed by primary commodities like palm oil and crude oil. Revaluation of the ringgit therefore is unlikely to unfavourably affect our export earning.
He observed that with the rising oil price, which is denominated in USD, has caused alarm to Asian countries although, he said, it is less felt by Malaysia. I think Malaysia is also not spared by the oil price increase, despite having own petroleum resources, because the oil is in USD and that is the world market price. If you are a buyer you have no choice with the price and if you are the seller you will not sell it at lower than market. It will definitely be translated into higher fuel cost for Tenaga, airlines operator etc, and perhaps it will result in less revenue for the govt if retail prices of petroleum products is not revised upward. With the lower exchange rate the impact on domestic price is exarcebated. Also Malaysia imports a lot of foodstuff for public consumptions and the exchange rate affect the cost of living of ordinary Malaysian. Since the introduction of exchange rate pegging domestic prices has been rising and it will be a matter of time before it will explode into a political issue.
Also in the letter from a reader entitled "Don't rush to open medical schools" he said the availability of sufficient quality lecturers has been a problem since the establishment of the first medical school (at Universiti Malaya). He said the ringgit then was good value for the international recruitment. Obviously it is even more unattractive now for prospective foreign lecturers to offer their services, even if pay is tripled that of the local lecturer.
Our high value added exports are not the manufacturing products but continue to be contributed by primary commodities like palm oil and crude oil. Revaluation of the ringgit therefore is unlikely to unfavourably affect our export earning.
Tuesday, June 08, 2004
E-Government
The government of Malaysia launched e-govt project a few years ago with a bang but it was hardly heard by the public at large. When the announcement was made it was loaded with jargons coined by the consultants engaged by the govt that even the person who proclaimed it may not understand what they were supposed to do: e-enabling, value driven etc. Thereafter Majlis Perbandaran Ampang Jaya launched its portal, so secretively that you have to do google search to discover its existence. The site did not even have a domain name. So I register to post a complaint about a contractor who was distributing a flier asking residents who had planted trees along the roadside to remove it within one week. No reason was stated in the flier other than to indicate that it was by the order of Yang Dipertua MPAJ. I am not going to record the reasons for my objection to the flier content but just to show that the portal system did not help create an efficient institution. There was no reply and I do not think anybody in MPAJ ever read it. The culture and work processes has to change to take advantage of the internet as a communication tool. Almost all govt departments have web page because it is fashionable to have it: doing something for the sake of doing it. I have seen one Ministry's web site that has as its most important content the photo gallery of its past secretary general. I wonder why people would want to visit govt web site at all?
At the other end of the spectrum the better IT facility, especially with better databases, has resulted in public distress. Suddenly the police was able to see the database of traffic offenders that goes back to as long as ten years ago. The offenders themselves do not have the kind of memory available to the computer system. To enforce it the police has announced that it will go house to house to search for these offenders and put up roadblock and detained them on the spot. Currently the police is said to be short of manpower and I think if all the effort is spent on history I wonder how current needs of public safety and order are met? There is no consideration of the opportunity cost involved in managing limited resources. Personally I think this is a case of abuse of technology.
At the other end of the spectrum the better IT facility, especially with better databases, has resulted in public distress. Suddenly the police was able to see the database of traffic offenders that goes back to as long as ten years ago. The offenders themselves do not have the kind of memory available to the computer system. To enforce it the police has announced that it will go house to house to search for these offenders and put up roadblock and detained them on the spot. Currently the police is said to be short of manpower and I think if all the effort is spent on history I wonder how current needs of public safety and order are met? There is no consideration of the opportunity cost involved in managing limited resources. Personally I think this is a case of abuse of technology.
Monday, June 07, 2004
University entrance
Every year admission into public universities in Malaysia has become controversial: it has become a racial issue. The Chinese is unhappy that more Malays are admitted. The Malays are said to be unfairly admitted through a quota system. The govt responded by changing the admission criteria to be based on merit, and this has resulted in more Malays being admitted especially in the most sought after faculty like medicine. Again the Chinese cry foul play because the Malay students are admitted through matriculation program and whereas the Chinese applicants used Higher School Cert (like the A Level). There were lot of arguments presented in the local newspapers that matriculation program is inferior to that of HSC: that HSC syllabus-wise is of higher level, it takes two years to complete, it is accepted world wide etc. For a common yard stick both system was converted into CGPA, but the matriculation program is intrinsically is CGPA system. For those who had been educated under the British and American system they would appreciate the merit of CGPA. Converting the end of year only, or end of the program only exam, into CGPA is not a good measure of student performance.
The raging controversy is definitely emotional in nature with very few of those presenting the arguments understand much about education system. Firstly it must be noted that grade inflation is a disturbing phenomenon in the British system: there are now more and more students obtaining straight As in A level exam that top universities have to impose additional criteria for admission. Diversity in admission criteria fulfill the social and national needs of Australia: they also based admission on matriculation and Year 12 exam. CGPA as the term stand for reflect the cumulative performance of the students through out the program and not just end of year exam. My conclusion is that countries like Australia and US do not use the national type or common exam for entrance except may be the apptitude test, and Malaysia is correctly adopting the same approach. Using multiple criteria including essays and references to assess the candidates is highly desirable.
The raging controversy is definitely emotional in nature with very few of those presenting the arguments understand much about education system. Firstly it must be noted that grade inflation is a disturbing phenomenon in the British system: there are now more and more students obtaining straight As in A level exam that top universities have to impose additional criteria for admission. Diversity in admission criteria fulfill the social and national needs of Australia: they also based admission on matriculation and Year 12 exam. CGPA as the term stand for reflect the cumulative performance of the students through out the program and not just end of year exam. My conclusion is that countries like Australia and US do not use the national type or common exam for entrance except may be the apptitude test, and Malaysia is correctly adopting the same approach. Using multiple criteria including essays and references to assess the candidates is highly desirable.
Saturday, June 05, 2004
Malaysian public enterprises appoint younger CEOs
Musical chair #1
In mid 80's the govt of Malaysia went all out to privatise public enterprises and govt activities. This include divesting major public utilities then operating as govt department and also farm out transportation related enterprises that include the construction of its infrastructure. Many failed because of abuses by the new shareholders and its management team and eventually they were rescued by the govt because of public interest. However the political leaders blamed the collapse of these enterprises to speculative activities of George Soros which weakened the Malaysian currency and consequently burdened these enterprises with large foreign denominated debt.
Musical chair #2
The new political leader has adopted a new approach to reinvigorate these enterprises. The govt related companies (GLC) must change its leadership with younger and academically brilliant candidates. Implicit in the announcement was that internal staff do not possess the right managerial skill and dynamism to lead these enterprises. Now that the new corporate chief has been appointed, and they are definitely very young, and they all come from another GLCs except for one. It is a musical chair.
I think as long as these enterprises remain govt owned they will continue to suffer the old malady that besetted these enterprises since its establishment. If only they were not acquired by cronies of the political leaders there is a much better chance for these GLCs to operate profitably. Question is how do you get the political will to change thing for the better?
In mid 80's the govt of Malaysia went all out to privatise public enterprises and govt activities. This include divesting major public utilities then operating as govt department and also farm out transportation related enterprises that include the construction of its infrastructure. Many failed because of abuses by the new shareholders and its management team and eventually they were rescued by the govt because of public interest. However the political leaders blamed the collapse of these enterprises to speculative activities of George Soros which weakened the Malaysian currency and consequently burdened these enterprises with large foreign denominated debt.
Musical chair #2
The new political leader has adopted a new approach to reinvigorate these enterprises. The govt related companies (GLC) must change its leadership with younger and academically brilliant candidates. Implicit in the announcement was that internal staff do not possess the right managerial skill and dynamism to lead these enterprises. Now that the new corporate chief has been appointed, and they are definitely very young, and they all come from another GLCs except for one. It is a musical chair.
I think as long as these enterprises remain govt owned they will continue to suffer the old malady that besetted these enterprises since its establishment. If only they were not acquired by cronies of the political leaders there is a much better chance for these GLCs to operate profitably. Question is how do you get the political will to change thing for the better?
Friday, June 04, 2004
Just sign in for blogging
Curious what blog can do for me. Wonder if it could replace my diary and do much more. I also wonder if the content could be archived forever so that it becomes a historical record.
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