There was a bad news on the Merdeka Day. The selling prices for RON95 and RON07 are now five sen higher than the prices announced by the government earlier. Although the increment is just five sen per liter, it is still an additional burden for low-income earners in economic recession times. The people would prefer no petrol price rise rather than the 20% discount for tolls and other small gifts if they are given choices to choose.

Politicians keep saying that they want to fight economy and increase the people's income. In fact, they are fighting at full strength only in politics. As for economy, their efforts are far from enough. The data speak for themselves and they show that we have all failed in economic fighting.

The Ministry of Finance predicted that the total income of the Treasury will be reduced by RM18 billion next year. Therefore, the government will reduce operating expenses by 15% while next year's deficit is expected to increase 11%. With a large number of civil servants, it is impossible for the government to reduce the 15% expenditure. Thus, it may have to cut all kinds of necessity allowances and medical benefits. It is more likely to increase tax revenue, including to implement consumption tax.

Take petrol as example, the government has to subsidise RM304 million (S$124.12 million) monthly. As the Treasury is short of money, once the international crude oil prices increase, the domestic oil prices will as well rise with the tide. And the international crude oil prices are expected to soar after the recovery of the world economy.

Now, in order to have a happy Hari Raya for Muslims, the government has been working so hard to control sugar prices. But the sugar prices of the world have already soared and the government has to spend RM720 million on sugar subsidy this year. How long will the Treasury be able to sustain? If the government does not subsidise sugar, flour and rice next year, it will set off another price hike wave.

Although the official data show that the country is currently facing a deflation (lower good prices), the public still feels that food and housing prices remain high. The situation turned even worse after the rise in public transport fares and oil prices.

Various signs show that next year will still not be a good year, particular for low-income earners. Other than the pressure brought by high oil prices, the probable reduction in government subsidies and the instability of the country's economy, it is more ominous that Malaysia is lack of a social safety net. We have no unemployment benefits or public health insurance. Once the situation turns worse, who is going to take care of the poor?

Economic fighting should focus on improving the overall economic environment, reducing the burden on low-income earners and improving the people's quality of life. However, if the government's financial situation worsens, how is it going to fight economy?

By then, the government may not only be unable to afford tax cut but it has to increase taxes instead. We have no way to attract foreign investment if we do not carry out changes for racial policies and political reform. How are we going to increase the people's income then?

Political farces, including power seizing by conspiracy and party struggles, are staged everyday. The economic revitalisation agenda has become less important. Politicians are focusing only on the fight for power and positions, while the pity economy is left to gradually turn weak.

(By LIM SUE GOAN/Translated by SOONG PHUI JEE/Sin Chew Daily)

--My Sinchew/ANN