The Madani government will address the issue of inflation in Budget 2025, which will be tabled on Oct 18, Malaysian Prime Minister Datuk Seri Anwar Ibrahim said.
Anwar noted that while the prices of goods such as edible oil, petrol and flour are relatively cheaper in Malaysia compared to regional peers, there remains a need to focus on improving income levels.
“The level of income has not increased, (amid) an increase in productivity or investments. We must address this issue; that is what I have done with the civil service. We raised civil servants’ salaries, which have been largely ignored for the last 12 years. You must take care of your own workers. Then you can apply moral suasion to the private sector conglomerates. (For instance), if you register profits of between RM1 billion and RM4 billion, you cannot (justify) paying your workers in that manner. So I think there should be some pressure to increase income levels because, although there are concerns about prices, it is because of low wages,” he told CNBC in an interview.
The Department of Statistics Malaysia (DOSM) reported that Malaysia’s inflation rate in August 2024 moderated to 1.9% year-on-year, slightly below expectations.
According to DOSM, inflation in August was driven by increases in restaurant and accommodation services (3.2%); personal care, social protection, and miscellaneous goods and services (3.2%); housing, water, electricity, gas, and other fuels (3.1%); and recreation, sports, and culture (2.0%).
Regarding civil service salaries, Anwar had earlier announced a 15% increase for civil servants in the implementing, management and professional groups, and a 7% increase for those in top management.
The adjustments will be implemented in phases, beginning on Dec 1, 2024, for phase one, and Jan 1, 2026, for phase two. This is the first salary adjustment in 12 years and is a timely response to current economic conditions. – Bernama
