BELIEVING that the national poverty rate is a mere 0.4% is simply “wishful thinking”, said the Malaysian Trades Union Congress (MTUC), agreeing with a United Nations report on the issue.

“MTUC, once again, calls on the government to take the matter of poverty seriously,” said secretary-general J. Solomon in a statement.

“Maintaining the poverty rate at 0.4% is simply wishful thinking, and failing to take remedial measures to reduce poverty in the country will result in dire consequences.”

The congress urged the government to conduct a review of the poverty line, saying yardsticks must be based on realistic criteria, like the high cost of living and stagnant wages.

MTUC was responding to a report by Philip Alston, a former UN special rapporteur on extreme poverty and human rights, on the findings of his visit to Malaysia last August.

Putrajaya has dismissed the report, insisting that the country’s poverty rate is 0.4%.

“The government must not be snobbish or arrogant in dealing with Alston’s report, but rather, use it as an important base to redress one of the key problems affecting more than 40% of the population,” said MTUC.

It said Malaysia’s poverty line index of RM980 per household – in place since the 1970s – is outdated, adding that the minimum living wage in urban areas now is RM2,700.

According to official statistics, the incidence of poverty fell from 37.4% in 1979 to 8.5% in 1999, further plummeting to 0.4% in 2016.

MTUC said Malaysians have long felt disconnected from the declared poverty rate, as many find their incomes insufficient to make ends meet.

“Such low poverty figures cannot be used meaningfully for policy-planning purposes to address the continued deprivations experienced by different segments of the Malaysian population.

“The B40 and M40 groups have been surviving on meagre salaries, with little savings for emergencies or old age.

“Many remain unable to afford decent housing, forcing them to live in cramped conditions in poorly maintained rented apartments. The absence of effective policies is due to misguided data, and the economic fallout from Covid-19 has worsened their plight.

“For the poor, the implications are serious. For those in their retirement years, having low wages and low EPF (Employees Provident Fund) savings, coupled with an increased life expectancy and facing reduced dependence on family, setting a low poverty line index will only expose them to vulnerabilities. It will also lull decision-makers into a false sense that everything is okay.”

MTUC highlighted Chief Statistician Mohd Uzir Mohidin’s announcement on February 14 that based on the multidimensional model, covering education, health, quality of life and household income, the poverty rate is 15.6%.

“This confirms Alston’s findings (that poverty in Malaysia is undercounted).” – July 7, 2020.