Malaysia aspires to become a high income nation
and to achieve this status we need to do away with raced-based policies
that are currently plaguing our system.
By Jeyaseelan Anthony
Recently our Prime Minister had announced an allocation of RM180
million to uplift the economic standing of the Indian community. It was
indeed a major announcement and a big step forward on the part of the
government to help the Indian community. However in practice whether
this allocation will help Indians in the long run is doubtful.
Malaysia is still plagued by discriminatory policies which favour the
majority bumiputera races. Announcing an allocation is rather easy but
making the money usable for business or social purposes is another.
Take for example a real incident highlighted by Senator S Ramakrishnan recently and I quote it here.
“One of my cousins wanted to import goats from Myanmar sometime in
2006. When he went to the Customs and Agriculture department for permits
to import, he was told that he can only import under a bumiputera name.
My cousin then went looking for a trusted bumiputera partner to import
goat or at least lend his name for that purpose and he managed to find
one. He imported goat and sold it in Malaysia. After the first import
the bumiputera partner went to Myanmar and started importing himself. My
cousin lost a reliable source of supply and income.
“This is how many small time Indian businessmen incur losses and face
difficulty in doing business in Malaysia. My cousin was so frustrated
that he brought many friends to the Hindraf rally on Nov 25, 2007. He
also has buses transporting workers. He has to get a bumiputera to get a
permit and pay a monthly fee to him for doing nothing. No other country
in the world has this kind of cunning and malicious restrictions on its
own citizens to do business.”
Many non bumiputeras face this problem. All this is done in the name
of Article 153 of the Federal Constitution which provides for
preferential treatment in favour of the bumiputera. Let’s take a look at
what Article 153 is all about.
It is implicit in Article 153(1) that “It shall be the responsibility
of the Yang di-Pertuan Agong (YDPA) to safeguard the special position
of the Malays and the natives of Sabah and Sarawak and the legitimate
interest of other communities”.
To set the record straight, the phrase ‘legitimate interest of other
communities’ means that it does not allow simply any kind of
preferential treatment in favour of the ‘bumiputera’. It is not a ‘blank
cheque’ but it merely confers limited powers on the government and
Parliament, pursuant to Article 153, to derogate from the principle of
equality and equal protection of the law.
The implementation of Article 153 has often been the bone of
contention as many have argued that its implementation has been at
expense of the other races in Malaysia. For example, although Article
153 provides for quotas only for the issuance permits and licenses to
the bumiputera, however, even government commercial contracts have been
awarded solely to bumiputera companies, which is clearly not sanctioned
under the Federal Constitution. Even government linked companies (GLCs)
and statutory bodies assign their work solely to bumiputera companies
and some major banks assign their legal work only to bumiputera legal
firms.
GLCs and local authority procurement and infrastructure building
contracts are mostly given to bumiputera companies. For example, local
authority contracts for infrastructure building are solely given to
Class F (not to forget the other types licenses like Class A etc under
the purview of the Finance Ministry) licensed contractors, which is a
type of license only given to bumiputera contractors although nothing in
Article 153 of the Federal Constitution permits Parliament to restrict
business and trade solely to bumiputeras for the purpose of reservation
of quotas.
The issuance of vehicle AP’s solely to the bumiputera is another
example of a policy and system that is unconstitutional as it is against
Article 153.
I now question how is the RM180 million allocation useful to the Indian community in view of these restrictions?
The realities on the ground
The realities on the ground
Allow me to digress here: The majority of employees at the GLCs and
some major banks are Malay bumiputeras although the Federal Constitution
only provides for reservation of quotas in the public service. Ethnic
quotas are imposed on private companies by government agencies and
licensing is used as a way to get private companies to observe
bumiputera quotas, a policy which is clearly against the Federal
Constitution as Article 153 only provides for reservation of quotas in
the public service.
Although Article 136 of the Federal Constitution provides for
impartiality in the public sector, there have been complaints by the
non-bumiputeras in the various government departments that they have
been deprived from getting promotions or have been sidelined in favour
of bumiputera candidates. This explains why the non-bumiputeras shy away
from seeking employment in the government sector and unfortunately it
also explains the current brain drain that is currently plaguing our
country.
These are several examples where the implementation of affirmative
action policies has clearly gone beyond the limits of Article 153 of the
Federal Constitution and has gone wrong. The problem that is quite
apparent here is that although the Yang Dipertuan Agong, after acting on
advice of the Cabinet, is bound to give binding directions to the
relevant authorities to ensure the reservation of quotas in the public
sector, scholarships and permits or licenses in favour of the
bumiputera, no one knows for certain what the percentage of the quotas
are. Is it 50%, 70% or 95% in favour of the bumiputera?
It is surprising to note that the Prime Minister had announced this
RM180 million allocation without even looking at the realities on the
ground. I believe that the weaknesses of the government’s policies must
be repaired first before announcing any allocations to uplift any
community. With the type of restrictions and limitations pervading the
non bumiputera communities under the guise of Article 153 of the Federal
Constitution, it would not be difficult to realize that the allocation
given to the Indian community for business purposes will be futile.
It cannot be denied that the improper and arbitrary application of
affirmative action policies as provided under Article 153 has
contributed significantly to the deteriorating race relations in
Malaysia. The deprivation of equal opportunities has caused racial
tensions to run high in recent years. Therefore in order to improve race
relations between the bumiputera and the non-bumiputera in Malaysia
there should be legislative intervention.
The number of quotas and restrictions and qualifications in favour of
the bumiputera are not well defined or specified under the Federal
Constitution. This loophole has led to the unfair, unbalanced and
unreasonable implementation of Article 153. A race relations law must be
introduced in Malaysia in order to remedy the imbalances and unfairness
that has led to discrimination.
The intention and purpose of Article 153(1) when read as whole
clearly provide for a balance between two competing interests, namely
the protection of the special position of the bumiputera and at the same
time safeguarding the legitimate interest of other communities as well.
However ambiguity arises when one realizes that the scope and meaning
of the words “legitimate interest of the other communities” are not
defined in the Federal Constitution. Even the courts have not decided on
this issue as the scope and ambit of provisions like Article 153 has
not been litigated before in Malaysia, in the way it has been done in
the USA and India. This lacuna in the Federal Constitution poses a
problem to good race relations in Malaysia. This is where I believe that
an effective and well drafted Race Relations Act is needed.
Reasons for enacting Race Relations Law
A comprehensive race relations law will provide the balance that the
original drafters of the Federal Constitution had intended when they
inserted the words “legitimate interest of the other communities” into
Article 153 of the Federal Constitution. A law on race relations would
help prevent discrimination and promote equality in all spheres of life
which affect Malaysians from all the different races.
There are two sides of the coin in support of this argument. On the
one side, the bumiputera are protected from discrimination and at the
same time their special position under the Federal Constitution is also
preserved. On the other, the non-bumiputera are also protected against
discrimination in the spirit of protecting the legitimate interest of
other communities as provided under Article 153.
A race relations law will not affect the special position of the
bumiputera as widely believed by many i.e. a reasonable reservation of
quotas can still be maintained in the areas specified under the Federal
Constitution but if there are areas where a particular racial group is
under represented in a particular trade or work area then the governing
authority on race relations or the minister tasked to manage and
regulate race relations under a race relations legislation will be
empowered take remedial actions to solve the problem.
The Race Relations Act 1976 and the Race Relations Amendment Act 2000
(now replaced by the Equality Act 2010) in the UK, for example provides
for such measures. A Race Relations Commission can be created under the
Act to implement the provisions of the Act and ensure the enforcement
of the Act.
In fact the Yang Di-Pertuan Agong under Article 153 is bound to act
on the advice of the Cabinet or a Minister acting under the authority of
the Cabinet. As such if the Cabinet or the Minister finds that there is
indeed under representation of a particular racial group in a
particular vocation or trade or sector and decides to take remedial
actions, the Yang Di-Pertuan Agong is bound to act on that advice.
The current system clearly shows that the bumiputeras are over
represented in many areas of employment in the public sector, in the
government and the local authorities, in government and local authority
procurement and in the public universities, etc. This over
representation has created a perception that the government is imposing
exorbitant and unreasonable reservation of quotas in the areas mentioned
in the Federal Constitution.
Surely, this is not what the Reid Commission had intended. In fact it
is clear from the wordings of Article 153(1) that the drafters of the
Federal Constitution did not envisage a system where reverse
discrimination would be the order of the day.
The time has indeed arrived to see whether implementing quotas under
affirmative action provisions are the way to go in light of the fact
that globalisation has created a more competitive world where
meritocracy is the order of the day, as compared to the time when the
Federal Constitution was drafted in 1957 in particular Article 153.
Affirmative action should not be cause for economic stagnation. In fact
the Reid Commission had intended that the communal-based policies would
be eventually eradicated from the country’s political and economic
spheres.
Malaysia aspires to become a high income nation and to achieve this
status we need to do away with raced-based policies that are currently
plaguing our system. The only way to create a conducive and market
friendly business environment and to get the private sector to be the
catalyst for the creation of a high income nation is to ultimately
eliminate race based policies in all sectors of business and society.
Jeyaseelen Anthony is an Advocate and Solicitor (non-practicing) and
was also a member of the Bar Council Law Reform Committee. He is a now a
consultant fellow attached to the Faculty of Law, University Malaya. He
is also a local councillor at Majlis Bandaraya Petaling Jaya. This
article first appeared in the CPI website.
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