KOTA KINABALU: The Sabah Employers Association said it was taken aback by the minimum wage rate of RM1,100 instead of previously announced RM1,050.
“It’is irregular to change suddenly like that; exposing the fact that minimum wage setting is likely a political consideration instead of economical, and if this is so it will be almost 20 per cent increment, which certainly will be burdensome for Sabah’s small employers, with none of their voices being heard, despite what state ministry has insisted,” said SEA president Yap Cheen Boon.
The Employment Insurance Scheme should not be continued in the budget, he pointed out.
“Sabah alone, both employees and employers together, contribute up to RM77 million a year. With low number of retrenchments ahead (as per Economic Outlook 2019), EIS will be more in (receipt) then out (disbursed), and will continue to snowball.
“The Government should not treat this contribution as a ‘spare buffer account’, but should instead abolish if not reduce further the contribution rate to allow more liquidity in the hands of both employees and employers.
“In a few years’ time when the fund has reached a few billion Ringgit it would be hard pressed to utilise objectively.
“Overall a ‘balanced-outcome’ budget in line with 11MP mid-term review. It is encouraging to see reduction in income tax rate for small companies with minimal profits, refund of GST & income tax credits, and allowing more funding alternatives.
“Worth noting is RM5,009 million for Sabah specific development expenditure which should see much needed basic infrastructure and utilities supply upgrade, at least some.
“The challenge of moving forward is to minimise recurring asymmetric situation for Sabah; how to ensure Sabah businesses have equal access to the assistance, funding in an informed, expedited manner as their Peninsular Malaysia counterparts. The onus is now on our state government to align the same,” he concluded.