PENSIONS IN MALAYSIA COULD COST UP TO RM643 MILLION PER YEAR?

Malaysiakini has an interesting article about the costs of pensions for MPs and states' assemblymen.

In the Malaysian Parliament, there are 222 MPs and according to M'kini, each MP costs about RM2.2m

However this is too simplistic a cost estimate and takes no account of the actual costs incurred after considering other factors.

If we take a 20-year cycle and taking into account different factors, the cost suggested is way below the real costs.

Malaysiakini suggests a total cost per annum of RM497million.

If you check out my table, you can see that the actual cost could be more than RM643million.

That is a 29% increase and shows the danger of too simplistic an analysis.

(Please click on table for a clearer image)

The following assumptions have been made.

Every GE, there is a turnover of 25% of MPs and the retiring MPs are entitled to the pension.

At the starting point, assume that 50% of the retired MPs are already enjoying the pension and at each GE, 25% of the 222 MPs will retire.  
Therefore at every 4 years, those on pension will increase by 25%.

At term5, the number of retired MPs reaches 388 and the total pension costs is RM12.68 billion over the 20 years; equaling to an average of RM634mil per year just on pensions for MPs!

Another factor that needs evaluation is the second or re-marriage of MPs who have retired.

This assumes that the pensions transfers to the current wife of an MP.

This remarriage factor also needs to be considered for pension costs.

In the example, it is assumed that MPs who divorce and remarry are 75% of the MPs and the average number of wives is 2. The pension is calculated at 50% and they extend the pension payout by another 15 years on average.

So the total costs over the 20 years for this extended pension costs is RM185 million and the average cost per year is RM9.25 million.

It is suggested that more analysis can be done using existing data on MP pensioners to check out the reasonableness of the scenarios suggested.

 

COVID 19 IN MALAYSIA -SOME SUCCESS SINCE THE MOVEMENT CONTROL ORDER ON 18TH MARCH 2020

Malaysia has seen some success since the Movement Control Order (MCO)
since18th March 2020; despite the recalcitrance of some residents to come
forward and be tested after attending a religious gathering for whatever reason.

Just to explain the graph I created for a simpler presentation that most people
can understand - I use the Daily Increase(DI) in the number of cases identified
and the Daily Moving Average(DMA).

The DI had a spike after the MCO was imposed; caused by the mass exodus
during the 24-hour period before the deadline.
Thankfully, things look under control now and the trend has been trending
down in the past few days - about 6%.

Strict measures have been imposed in a few areas with zero movement
outside of homes and residents have been targeted for medical screening.

There has been talk to allow the Ramadan bazaar, where small business folks
are allowed to set up stalls for the public to buy food.
This has alarmed the public as many feel that usual crowds during such
bazaars will undo the great work that has been done by the front-liners
- the Doctors, the Nurses and other Healthcare staff; plus the Enforcers.

So I'm suggesting that the Ministry of Health should come up with some
universal guidelines on the targets to be met before the MCO can be relaxed.
This could be a DI of below 50 and DMA of 3.

What do you think?

WHY PLUS should NOT be sold to third parties

So the government is waiting for a better offer before it decides to sell PLUS, the main operator of the North-South Highway. About 8 years ago, there was a MGO for PLUS and the company was delisted from BURSA MALAYSIA and now operates as a non-listed company so that the public does not see the Annual Accounts. Management fees are high for a basic infrastructure company.

I suggest this proposal that will be a win-win for all concerned. Both the government and taxpayers will benefit from such a scheme that will give back PLUS to the people.

How this is achieved will be selling Khazanah's stake back to the public for RM5bil to RM6bil. This will be done via a new IPO bundled with a 5% bond that expires with the toll agreement in 2038 or just over 18 years.

Suppose 2 million Malaysians subscribe in the IPO for RM1000, that will raise RM2bil.
If the loan stock option is taken-up at RM1500 each, that will raise another RM3bil.
If we want to raise RM6bil, the IPO will be RM1500.

So for RM2500, a taxpayer will be an owner in PLUS and enjoy the rewards. In fact many Malaysians owned PLUS until the government allowed Khazanah to kick out the minority shareholders.
All shareholders will be given a 10% discount on NSH tolls.

Therefore, I urge the government to sell PLUS back to the people. 

1MDB Scandal - Take the POLL

There has been a lot of information and misinformation right from the moment the 1MDB scandal broke and the PM has only declared that the monies in his accounts were not for "personal" use, whatever that implies.
Thus far, we have had allegations of money laundering, tampering of evidence, blackmail, murder and even conspiracy.
This poll is just to get a feeling of what is your reaction. Thanks for your participation!
 

survey service

The Main ISSUES about the WSJ and 1MDB

They say a picture paints a thousand words so this flow-chart may help you to understand the 1MDB fiasco and why the Malaysian PM is fighting to keep his post....

Missing MH370, missing billions of 1MBD and now missing oil tanker? What's next?

Maybe we will have a missing Prime Minister! 










(photo:thanks to astroawani)

A Good Example of a BAD Bureaucracy?

There is this story that has a happy ending but I just wonder how many applicants died before they could receive the good news?
One more reason why local council elections would benefit the ordinary citizens who are struggling to survive.
20 years to solve cleanliness and traffic congestion issues! I wonder how long it will take to find solutions for problems in the proposed nuclear power stations?