THE uproar over the government’s critical service incentive (BIPK) is another symptom of the unemployed graduate problem – a structural disconnect between the education system and job market.

Current and former civil servants also said the issue reflects flaws in the healthcare system, where there are insufficient spots for medical graduates, and yet, the country’s private colleges continue to churn out an unending amount of grads.

BIPK was started in 1992 to attract and retain talent in the civil service at a time when professionals, such as doctors, engineers and accountants, were making a beeline for the growing private sector.

But what was seen as a carrot then is now a necessity, said government doctors, especially for medical grads struggling to pay off their education loans and survive Malaysia’s high cost of living.

The Public Service Department (PSD) had proposed that BIPK be discontinued for new hires for 33 posts, including doctors, nurses and engineers, as it no longer met its aim.

However, the cabinet decided to review the decision following criticism from the public, as well as ministers.

The problem starts in the massive private tertiary education industry, which has produced a glut of medical graduates and those trained in science and engineering disciplines.

These grads then compete for jobs in the larger private sector and smaller public sector, said former senior civil servant Ramon Navaratnam.

The tens of thousands of applicants for the civil service’s limited professional posts reflect the oversupply of graduates in the job market, said Ramon, who now heads the Centre for Public Policy Studies think-tank.

According to a 2016 Bank Negara Malaysia study, those with tertiary education qualifications had a higher rate of unemployment at 15.3%, compared to 9.8% for those who only finished secondary school.

Grads in science disciplines tended to have the highest rate of unemployment, at 27.7%, compared to those in other fields.

Since BIPK’s main aim of attracting talent is no longer relevant but the objective of trimming the civil service remains, said Ramon, it makes sense to phase out the allowance to save public funds.

“The bigger question is the size of the civil service. If it is bloated and needs trimming, why make it more attractive?”

Malaysia has a civil service-to-population ratio of 1:20, one of the highest in the world. In comparison, South Korea has a ratio of 1:50, and Singapore, 1:71.

“Are we producing too many graduates without communication skills and a good command of English, whom the private sector does not want?” said Ramon.

“Do these people then attempt to apply for posts in the public sector? But the public sector, like the private sector, must take only the best brains. Otherwise, how will it be world-class?” said the 30-year civil service veteran, whose last post was Finance Ministry deputy secretary-general.

Non-permanent but critical

According to PSD, BIPK is a non-permanent allowance started to help it fill posts at a time when there was a critical shortage of talent.

The “critical” aspect refers to the shortage of applicants, and not the nature of the posts.

This means that BIPK can be discontinued if there is no longer such a shortage, said the department in a statement on December 26 last year.

The allowance was reviewed in 1997, 2001, 2007 and last year, to assess whether the shortage issue still existed.

Besides healthcare professionals and engineers, those who got BIPK included architects, marine officers, pilots, dentists, air-traffic controllers and content producers.

In its 2019 assessment, PSD found that there is no longer a critical shortage of applicants for the 33 posts that received the incentive, meaning BIPK can be discontinued.

There has been an excess of applicants for all 33 posts, including for housemen or trainee doctors, the number of whom has shot up to the hundreds of thousands.

The review last year showed that there were 222 vacancies for nurses’ posts, but 10,884 applicants; medical officers or housemen (15,268 vacancies, but 24,756 applicants); and, engineers (852 vacancies, but 169,435 applicants).

In 2019, RM969.52 million was spent on BIPK, and the total will hit RM1.05 billion this year.

A doctor based at a Penang government hospital said he still sees a high number of housemen despite the limited vacancies and a moratorium on medical programmes in the country.

In 2011, the government imposed the moratorium to stem the deluge of medical graduates.

“Even with the moratorium, we have too many private medical colleges and medical grads, but not enough posts for housemen in government facilities,” said the doctor, who requested anonymity as civil servants are barred from openly speaking to the media.

Heart surgeon-turned-lawmaker Dr Ko Chung Sen, meanwhile, said the mismatch between the high number of medical programmes and underinvestment in public hospitals is why there are more housemen than there are places to train them.

Incentive turned necessity

A government doctor based in the Klang Valley said although BIPK’s original intent has been realised, the allowance should be continued for housemen.

“The starting salary of a young houseman is low, and if you take away his allowances, it will take away 20% to 25% of his monthly income,” said the doctor, who also wanted to be unnamed.

“This is the income they use to pay rent and pay back their medical college loans. If you just earn about RM4,000 a month, it will take you more than a decade to pay back your college loans.”

Currently, housemen earn a basic salary of RM2,947, according to Malaysia Medics International, and BIPK of RM750 per month.

Including all other PSD allowances, their gross income comes to RM5,197 per month. Without BIPK, the figure is reduced to RM4,447.

“New doctors need BIPK. Otherwise, they cannot cope. If we don’t retain them by having this allowance, there will be an even bigger push factor for them to leave for the private sector once their housemanship is over,” said the Klang Valley doctor.

“Already, some doctors are not getting pensions, so what is the purpose of staying in the public sector?”

Adam Mukhriz Mohd Muhayeddin, a media officer with the Prime Minister’s Department, said PSD has to be fair to every civil servant.

“It’s not fair if a young person joins the civil service and he does not get the same allowances as his seniors,” he said in a Facebook post criticising PSD’s decision to do away with BIPK.

“Everyone should be treated the same. Either retain the allowance for everyone, or replace it with something else for everyone.” – January 1, 2020.