KUALA LUMPUR, July 5 — The huge reductions in economic impact and jobs created from the Economic Transformation Programme (ETP) projects as stated in the 2011 annual report is “shockingly” under-explained, said the Research for Social Advancement (Refsa) think-tank today.
Refsa said that in the annual report, RM107.7 billion of gross national income (GNI) and 75,000 jobs equivalent to 45 per cent and 20 per cent of the respective original forecasts were “written off”, which they said raised questions about the level of due diligence exercised during the original forecasts.
The opposition-linked research house said that changes of 5-10 per cent could be acceptable as “recalibration” in the normal course of changing business conditions.
“But a whopping 45 per cent reduction in GNI contribution means that the original forecast was nearly double the level that is now considered realistic,” said Refsa in a statement today.
“It appears that some EPPs had presented forecasts that extremely exaggerated their potential.”
Refsa also said that such overestimates were a failure on the part of the labs run by government efficiency unit Pemandu and that the level of explanation given was deeply inadequate.
“The lack of explanations and disclosure by Pemandu on such massive changes is shocking,” it said. “What type of jobs disappeared? Which projects severely overstated their contributions? And most importantly, what remedial action is Pemandu taking to make up for these chasms?”
The think tank also took Pemandu to task for calling the reductions a “recalibration”, saying that the level of amendments were a “massive revision.”
It nevertheless gave credit to Pemandu for engaging an independent auditor, but added that it was also reasonable to expect the unit to show the details of the changes in figures and explain where and why these changes occurred.
Refsa had previously said Pemandu’s insistence on presenting an image of “perfection”, and not disclosing issues and problems related to its ETP projects could backfire later.
Pemandu has also criticised Refsa for being “biased”, for “nit-picking”, and not offering alternatives to the current plans.
It also said that it would remain focused on the high-income nation objective despite external challenges.
Pemandu was established soon after Prime Minister Datuk Seri Najib Razak came into office in 2009 and is tasked with spearheading efforts to reform the economy and government administration under the Government Transformation Programme (GTP) and ETP.
It is headed by oil and gas veteran Datuk Seri Idris Jala, who also served a stint as CEO of Malaysia Airlines.
Critics have expressed doubt over whether the ETP and GTP will succeed where attempts by previous administrations have failed, and have also described the programmes as merely serving the five-year plans of the country’s big businesses.
Jala responded by saying the ETP and GTP are different from older reform attempts as they are specific programmes with actionable goals and deadlines and take into account consultation with the country’s various stakeholders.
He is also known for his optimistic outlook and often urges members of the public to focus on the positives.
Opposition-linked Refsa is a not-for-profit institute that does research into social, economic and political issues.
Its analysis on the ETP annual report was authored by Ong Kian Ming, who holds degrees in economics from the London School of Economics and Cambridge and Teh Chi-Chang, a chartered financial analyst who holds a degree in accounting and financial analysis from the University of Warwick, and an MBA from the University of Cambridge.
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