KUALA LUMPUR: The government should trim down the scale of the civil service sector if it wants to reduce the budget deficit, said Tan Sri Datuk Mohad Sheriff Mohd Kassim, immediate past president of the Malaysian Economic Association (MEA).
Speaking at the “Economic Governance: Public Sector Governance” Forum, Sheriff said “expenditures on salaries and pensions are increasing all the time , whereas revenue is subjected to the ups and downs of the economy and sometimes revenue growth maybe stagnant.”
“In modern times I think there is less need for this corresponding increase in the staff for the administration and support functions,” he added.
Citing the ratio of civil servants to the population, of which Malaysia stands as one of the highest, Sheriff said the salaries and pensions of civil servants take up a huge sum of government expenditure. The Malaysian civil sector currently employs 1.6 million people.
Downsizing could be effective with rationalisation, deployment and retrenchment with attractive voluntary retirement schemes (vrs), to reduce the number of redundant staff and increase productivity with the use of technology.
“It is good to retrench when the government can still afford it than to do it when there is a financial crisis,” he said.
“It is kinder to retrench with incentives then to cut their salaries, ” added Sheriff.
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