KUALA LUMPUR : A former top civil servant has called on the Government to consider downsizing the country’s bloated civil service, while it still can.
Malaysia has the highest civil servants-to-population ratio in Asia Pacific, employing 1.6 million people or 11% of the country’s labour force.
Tan Sri Mohd Sheriff Mohd Kassim – the former Finance Ministry secretary-general and Economic Planning Unit director-general — said that Malaysia may not be able to sustain this workforce if it runs into a financial crisis.
He said on Monday that if the Government was really set on keeping the national deficit to three percent, it needs to look at retrenching employees, particularly in the lower levels of the civil service, to cut spending.
“Government bureaucracy has grown so big that it’s not only taking up too much resources but creating many failures in our finance economy.
“There are just too many rules and regulations that the public and private sector have to live with,” he told a delegation of economists, politicians and government officials at the Malaysian Economic Association’s forum on public sector governance.
He advised Malaysia to begin downsizing the civil service, “better sooner than later,” if it wanted to avoid running the risk of falling into a Greece-like crisis, where the European country had to cut salaries and was unable to pay pensions for its civil service.
Drawing examples from the recent Malaysia Airlines restructuring, where 6,000 people were retrenched, Mohd Sheriff said that it was better to let staff go now and compensate them with retrenchment packages while the Government can still afford it.
“It may cost the Government a heavy expenditure now, but it is worthwhile to do it while we can still afford it and not until we are forced into a financial crisis like Greece.
“We don’t want to be in that situation. I think we should do it gradually. It is kinder to do it now with incentives than to suddenly cut their salaries and pensions at a time when they can least afford it,” he said.
Malaysia is expected to spend RM76 billion on salaries and allowances for the civil service this year, on top of another RM21 billion for pensions.
Efficiency and corruption dominated talks on the civil service at the forum, held at Bank Negara’s Sasana Kijang.
Mohd Sheriff, who is also former president of the Malaysian Economic Association, said these issues have been around since his time in the civil service decades ago – though not much has changed due to a lack of political will.
In jest, he suggested Malaysia emulate US President Donald Trump’s idea on downsizing the US civil service.
He also suggested Parliament create a committee to monitor the performance of top civil servants and give them the ability to retrench these officers if they fail to meet their marks.
“In many countries, even Indonesia, they have committees to hold government leaders to any shortcomings on policy implementations and projects.
“These are the kinds of checks and balance we need to make our civil servants aware that they are being monitored for their work and they can be pulled out at any time,” he said.