By Siva Sithraputhran and Niluksi Koswanage PUTRAJAYA, Malaysia (Reuters) - From unwinding subsidies for food and fuel to imposing a new sales tax, Malaysia's Prime Minister Najib Razak has plenty to do to rescue the country from a possible credit rating downgrade when he presents his government's annual budget this month. One thing Najib won't dare risk is upsetting the country's majority ethnic Malays by downsizing a bloated civil service, despite its heavy impact on a fiscal deficit that is the biggest in emerging Asia after India. Though the next election is only due by 2018, the ruling National Front coalition is already looking nervously to the future after a contentious victory last May, and Najib cannot take for granted that his own party, the United Malays National Organisation (UMNO), won't jettison him before his term is up. "If the National Front institutes policies that make the Malays or the government servants unhappy, a 2-3 percent swing next time to the opposition will spell defeat," said Ibrahim Suffian, director at the respected pollster Merdeka Centre. Dominated by Malays, the civil service, with its jobs for life and access to cheap loans, serves as part of a decades-old affirmative action policy. At 60 billion ringgit ($18.78 billion) its wage bill is the single largest budget item, accounting for a third of total spending. The fiscal burden, along with a shrinking current account surplus, renders Malaysia vulnerable to foreign capital outflows at a time when investors are eyeing emerging markets with growing caution due to expectations that the U.S. Federal Reserve call time on years of easy money in the coming months. But, mindful of preserving stability, policymakers often make ethnic considerations a priority in this nation of 29 million people, made up mostly of Malays, Chinese and Indians. It was the Malay vote that helped the National Front, which comprises parties from each ethnic group, scrape back into power, despite losing the popular vote for the first time in 56 years since independence from British colonial rule. UMNO holds elections later this month for senior party positions, and with conservatives circling, the more liberal-minded Najib will be keen to shore up support, though he is not facing re-election himself as party chairman. "Now, he has to really take care of the Malays," said an ethnic Malay clerk, whose civil service unions have asked for a two-and-a-half month bonus to be included in the budget. Faced with these compulsions, Najib is likely to make cuts elsewhere when he unveils the budget on October 25. "Food and fuel subsidies will be the easiest expenditure for Najib to cut after the elections, but not the civil service," said Chua Hak Bin, a Singapore-based economist with Bank of America Merrill Lynch. "That is out of the question, for now." Instead, Najib is expanding the public service, a vital source of support for UMNO. Some 200,000 people have joined the civil service since he became prime minister. At 1.4 million people, the civil service accounts for 10 percent of the labour force, and by that measure is the largest in Southeast Asia. The hiring isn't over. This year there are plans to add 80,000 employees, double last year's intake. Unemployment is not particularly high at 3 percent, but young Malays often struggle to find work in the private sector. Nine out of 10 unemployed graduates are Malay, raising a fear in UMNO that first-time voters in youthful Malaysia could turn against the party at the next election, unless they have jobs. CUT OR BE CUT In reaction to the unconvincing election victory, Fitch Ratings warned in July that deteriorating public finances or a current account swing into deficit, along with other concerns, could lead to a cut in Malaysia's credit rating, though it is comfortably lodged in investment grade. Currently, the government receives nearly half its revenues from Petronas , the state oil and gas giant. "There may be efforts to increase the revenue base with the goods and services tax and other tax increases, but this amounts to little if government efficiency does not improve and the bureaucracy keeps on growing," said Chua. Deputy human resources minister Ismail Abu Muttalib said the size of the civil service was not a worry as employees would find jobs in the private sector as Malaysia develops more. "The situation will resolve itself," he told Reuters. "For now these government servants are needed to deliver the government's social programs to the wider public." (Editing by Stuart Grudgings and Simon Cameron-Moore)
- The Telegraph
The Duke and Duchess of Sussex have been “demoted” on the Royal family’s website to bottom billing alongside the Duke of York.
In order to ensure his children have a 'normal' upbringing, Prince William reportedly told royal staff they can't wear this particular item of clothing.
"Obviously this means the lawyer must have given Trump actual legal advice," mused one social media wit.
Frankly, I don't think we need to see any of these people make a comeback. You had your shot!View Entire Post ›
"Movie-making is very hard work over a very long period of time that consists of so many moments of joy slapped up against an equal number of feelings of self-loathing," the Oscar winner said.
Ian strengthened into a major hurricane Tuesday as its track moved east into Central Florida.
A slight shift was also made on the pages for Prince William and Kate Middleton, the new Prince and Princess of Wales
Anthony Bourdain Texts Published In New Biography Reveal Grim Final Days: “I Hate My Fans…I Hate Being Famous…I Hate My Job” – Report
A new unauthorized biography of Anthony Bourdain, which includes for the first time the celebrity chef’s text messages from the days leading up to his death by suicide in 2018, reveals Bourdain’s anguish over his career, his estranged marriage and his troubled romantic relationship with actor Asia Argento. Selections from the book Down and Out […]
Kate Middleton Will Receive the Majority of Queen Elizabeth’s Jewelry Collection—But There’s a Catch
The royal family has been sorting through Queen Elizabeth’s affairs ever since she passed away at age 96. They already confirmed that her corgis have found a new home, but the world is wondering what will happen to Her Majesty’s jewelry collection. Tim Graham Picture Library/Getty Images Kate Middleton will reportedly receive the “lion’s share” of Queen Elizabeth’s accessories. However, King Charles’s wife Camilla Parker Bowles (aka the Queen Consort) will get to pick first. Max Mumby/Indigo/Get
“I feel so good turning 50, and this is about expressing that sense of energy and optimism.”
NASCAR officials handed out two sizable penalties Tuesday for rough driving, docking William Byron and Ty Gibbs for their roles in separate incidents in last weekend’s Cup Series race at Texas Motor Speedway. Byron was hit with a 25-point penalty in both the driver and team owner standings for bumping Denny Hamlin out of position […]
- Rolling Stone
The Kremlin chooses to escalate the war in Ukraine with a dangerous gamble, but the signs of an unraveling are becoming clearer both at home and abroad
- In The Know by Yahoo
A dentist has stunned her TikTok viewers after revealing that the majority of people are using mouthwash incorrectly. The post Dentist stuns viewers with revelation about mouthwash appeared first on In The Know.
- The Advocate
Buttigieg did not come to play.
- Seahawks Wire
On the bright side, their ex isn't doing much better.
- Women's Health
Addison Rae, 21, was spotted in Los Angeles this week sporting spandex booty shorts and her epic, sculpted butt. Addison is all about Pilates and pasta.
In Katie Nicholl's upcoming book "The New Royals," she writes that Queen Elizabeth intervened when Meghan Markle clashed with a royal staffer.
Week two saw Sarah Michelle Gellar tearfully cheering on her best friend Selma Blair, Teresa Giudice dedicating her dance to her late father and one couple's chemistry raising eyebrows
- Bradenton Herald
Here’s what to know Tuesday as Bradenton and Manatee County prepare for a possible major hurricane.
It's time to audit those fantasy rosters. Jennifer Eakins suggests some players to cut for your Week 4 waiver wire pickups.