12th June 2021
MCO 3.0 extension: Call upon the Government to immediately implement an automatic moratorium for at least 3 months for M40 and below and all businesses sectors, and extend the wage subsidy for at least 3 months at the rate of RM1,200.00 every employee to save the SMEs and to save jobs
The Government has announced the extension of MCO 3.0 for 2 weeks, i.e. from 15.06.2021 to 28.06.2021. This means most of the economic sectors will remain closed except those classified as essential services under the SOP.
The announcement has effectively brought the minimum period of Total Lockdown for MCO 3.0 to at least 4 weeks, getting closer to the total 6 weeks Total Lockdown during MCO 1.0 before the setting in of CMCO on 4th of May last year. There is no certainty whether MCO 3.0 will be extended further after 28.06.2021.
The SMEs that are not allowed to operate will be heavily hit. The Government should be looking at a similar if not better economic stimulus packages especially after the business sectors and economy had been affected more than 1 year by the pandemic. However, the Government has done too little in its effort to save the SMEs and to save jobs during MCO 3.0.
Source: Focus Malaysia
Automatic moratorium was granted across the board for six months during MCO 1.0. The option is on the Borrowers to decide whether they want to opt out from the moratorium and continue servicing the loan. However, the Moratorium announced by the Prime Minister Muhyddin Yassin on 31.05.2021 did not provide automatic moratorium for M40 and businesses sectors whom the Minister in the PM Department (Economy) Mustapha Mohamed admitted that are most stressed and desperate for help during MCO 3.0.
The Government and the Finance Minister had failed to safeguard the people’s interest. An automatic moratorium will not and should never cost the Government financially. The Bank’s interest is not adversely affected as the Moratorium granted comes together with interest even during MCO 1.0. Why is the Government still adamant in not listening to the people’s grievances?
Another important element in saving the SMEs and saving jobs is the implementation of Wage Subsidy (Program Subsidi Upah – PSU). Under the PSU 1.0 during the first Total Lockdown last year, the employers were subsidized RM1,200.00 every employee for the first 3 months, followed by RM600.00 every employee for the second 3 months. It was further extended to PSU 2.0 whereby employers were subsidized RM600.00 every employee for another 3 months with stricter conditions to be met. The Finance Minister had announced that the program had helped to maintain 2.695 million jobs.
What is the Government aiming to achieve when they are only giving one month Wage Subsidy at the rate of RM600.00 every employee for MCO 3.0, when most of the SMEs are facing a 4-weeks total close-down? It is clearly too little and not sufficient to guarantee the saving of jobs.
Furthermore, the SMEs had the option of an immediate cash flow up to a RM1 million loan through the Specific Relief Facility (SRF) worth RM5 billion last year. There is none under MCO 3.0. Is the Government now telling the SMEs to close shop, which will have a direct consequence of jobs loss, after MCO 3.0?
It is war time now and the Government has to do more at all cost. I call upon the Government to immediately implement an automatic moratorium for at least 3 months for M40 and below and all businesses sectors, and extend the wage subsidy for at least 3 months at the rate of RM1,200.00 every workers.
Wong Kah Woh
MP for Ipoh Timor