Media statement by Lim Kit Siang in Kuala Lumpur on Thursday, 10^th February 2011: 

Present the New Economic Model (NEM) for formal adoption by Parliament next month if Muhyiddin’s denial that it had been “watered down” is to have any credibility

The New Economic Model (NEM) should be presented to Parliament next month for formal adoption if Deputy Prime Minister, Tan Sri Muhyiddin Yassin’s denial that it had been “watered down” is to have any credibility.

In fact, the revelation by National Economic Advisory Council member Datuk Dr. Zainal Aznam Mohd Yusuf on Tuesday that the NEM had been “watered down” due to pressure by Perkasa and other right-wing groups had not come as a surprise, as it merely confirmed what had been obvious to many.

The theme of my speech in Parliament on the Tenth Malaysia Plan on 21st June last year (less than three months after the official launching of the NEM by the Prime Minister, Datuk Seri Najib Razak), was “Tenth Malaysia Plan: Long live NEP - RIP NEM”.

“The Prime Minister unveiled the New Economic Model on 30th March and presented the Tenth Malaysia Plan in Parliament on 10th June. A sea-change took place in the intervening two months, with Najib retreating from his national transformation programme when he succumbed to pressures from extremist groups making baseless and incendiary claims such as that the Malays are under siege and that the Chinese would take over the economy and country.

“The NEM admission that ‘the excessive focus on ethnicity-based distribution of resources has contributed to growing separateness and dissension’ is completely absent in the Prime Minister's presentation of the Tenth Malaysia Plan.”

What is there for Muhyiddin to deny when Zainal, as NEAC member, had only confirmed what is known to all?

The most significant “watering down” of the NEM is the abandonment of the most important of the eight Strategic Reform Initiative (SRI) described as "fundamental to achieving the NEM” - on "Transparent and market-friendly affirmative action", viz:

"Existing affirmative action programme and institutions will continue in NEM but, in line with views of the main stakeholders, will be revamped to remove the rent seeking and market distorting features which have blemished the effectiveness of the programme. Affirmative action will consider all ethnic groups fairly and equally as long as they are in the low income 40% of the households. Affirmative action programmes would be based on market-friendly and market-based criteria together taking into consideration the need and merits of the applicants. An Equal Opportunities Commission will be established to ensure fairness and address undue discrimination when occasional abuses by dominant groups are encountered." (Chapter 6 of NEM – p. 117)

The promises of the NEM of a needs-and-merit based transformation of the affirmative programme, to focus assistance on the low-inocme 40% of the houeholds earning less than RM1,500 per month (of which 77.2% are bumiputras), to promote building of capacity and capability, which will mean a dismanting of ethnic quotas, preferences, APs, closed tenders and other non-competitive processes, were very short-lived - all because of failure of political will and leadership.

The NEM had warned of the dire consequences of failure of political will and leadership to carry out far-reaching national political, economic, social and government transformation.

It rightly identified the most important enablers of the NEM are political will and leadership to break the log-jam of resistance by vested interest groups and preparing the rakyat to support deep-seated changes in policy directions.

It called for political will and leadership to put emphasis on coherent explanation of the vision and agenda of the NEM and transformation process and "to put in place a critical mass of bold measures" to "create an unstoppable wave of support from all segments of society for this vision".

It warned:

"The government must take prompt action when resistance is encountered and stay the course".

But all the NEM vision, agenda and warnings have come to nought with the “watering down” of the NEM as a result of opposition of Perkasa and other right-wing extremist groups.

Lets put Muhyiddin to the test when he denied any “watering down” of the NEM? Is he prepared to support the tabling of the NEM to Parliament when it reconvenes for a month from 7^th March for MPs to adopt and endorse the NEM without any “watering down”?

*Lim Kit Siang, DAP Parliamentary Leader & MP for Ipoh Timor