Privatisation of public hospital services revisited

Josh Hong

Not many are aware that the universal healthcare coverage that Malaysians currently enjoy has its origins in Britain's National Health Service that was launched in 1948. – The Malaysian Insight file pic, August 23, 2021.

THE death of an unvaccinated Indonesian cleaner in a Klang public hospital from Covid-19 is a tragedy that could have been avoided.

Given the high-risk environment that the cleaner worked in, the failure of the Health Ministry to conduct due diligence and ensure all the hospital workers have been vaccinated clearly constitutes gross negligence.

Thus, the hospital authority should not have just shifted the blame to Radicare – to which the deceased was attached – without owning up to its own mistake.

It should instead carry out a thorough investigation followed by a disciplinary action wherever necessary, or there’s no guarantee the same thing will not happen again. Appropriate compensation should also be made to the deceased’s family.

After all, how could the MOH and Radicare, the concessionaire, have failed to vaccinate all the cleaners who are also front-liners in the fight against the pandemic?  

In any case, the tragic incident has come to symbolise the bitter fruit of the outsourced public services.

Not many are aware that the universal healthcare coverage that Malaysians currently enjoy has its origins in Britain’s National Health Service that was launched in 1948.

Thus, all the workers in healthcare facilties – including cleaners, food caterers and security guards – were civil servants regardless of their job description and grade.

All this changed when Dr Mahathir Mohamad as prime minister began to push for the privatisation of the public service sector, taking a leaf from the neo-liberal ideology of then US president Ronald Reagan and then UK prime minister Margaret Thatcher in the 1980s.

It was during Thatcher’s tenure that Britain began to outsource the “non-essential” services to private entities.

The Dr Mahathir administration of the 1990s considered the public healthcare sector to be a heavy burden that the state could no longer shoulder.

Ironically, Dr Mahathir, having served at government hospitals and allegedly provided free medical care to the poor later as a private doctor, began to advocate the removal of free or heavily subsidised treatment to all patients.

One argument he used at the time was that a social system in which society would come before self, for the sake of which the welfare of the people should not revolve around the state but a strong and resilient family system.

He also believed privatisation would relieve the state of the government’s financial and administrative burdens, improve productivity, stimulate economic growth and downsize the public sector.

Dr Mahathir could not have implemented his neo-liberal economic agenda without his right-hand man – Anwar Ibrahim.

In 1995, the then finance minister announced that a number of support services in the public sector would be privatised, including those at government hospitals such as cleaning, security, maintenance, disposal of clinical waste and laundry.

Under the 7th Malaysia Plan (1996-2000), these services would be outsourced to private entities in the name of improving market efficiency and cost-saving.

More than a quarter of century on, it is crystal clear that the privatisation that took place at breakneck speed has only, in many cases, incurred huge losses, worsened the quality of services and enriched many of the cronies with close links to Barisan Nasional in general and Umno in particular, with a bloated civil service to boot.

For instance, the consortium that was awarded the concession (and monopoly) to run the services in public hospitals in the southern zone was none other than Tongkah Medivest, the managing chairman of which happened to be Mokhzani Mahathir, one of Dr Mahathir’s sons. Of course, the former prime minister would often say his children became rich all thanks to their own efforts.

This aside, another concessionaire that won lucrative contracts under the privatization of hospital services was Asia Lab, a company once owned by two Umno-affiliated businessmen, i.e. Sulaiman Aris and Azmi Jaafar. It later became Radicare, the employer of the deceased Indonesian cleaner.

Once started, the outsourcing of support services became unstoppable. In March 2015, the government under Najib Abdul Razak’s leadership signed a new 10-year agreement, with a total value of RM1.3 billion, with five concessionaires, all of which are wholly owned by UEM Edgenta, a subsidiary of Khazanah Nasional Bhd, Malaysia’s sovereign wealth fund, with the exception of Radicare.

Hence, many of the staff members that should rightfully have been included as public servants are now excluded from state benefits as they are considered private employees of the concessionaires, cleaners at government hospitals being among them.

As contract labour, they face hurdles in accessing bank loans and risk forfeiture of their annual leaves or bonuses whenever the companies are sold and they are made to sign a fresh contract with the new employer.

One major problem that confronts outsourced workers is that disputes often arise as to who should be accountable when occupational safety and health incidents happen, as is the case with the death of the Indonesian cleaner at the Klang hospital.

Kudos to Parti Sosialis Malaysia which has revived the National Union of Workers in Hospital Support and Allied Services and achieved some successes in enhancing workers’ rights. For instance, they managed to pressure UEM Edgenta to honour the collective agreement that the cleaning workers had signed with the previous company.

Still, Malaysia’s rate of unionisation remains low at about 7% of the workforce, while migrant workers face even greater difficulties in joining a union due to their status as foreigners.

While the Trade Unions Act 1959 allows migrant workers to join an existing union, it bars them from establishing one of their own and assuming leadership. These are areas that are in critical need of reform.

In retrospect, many of the problems that we encounter in accessing better public services today can be traced back to the neo-liberal policies of the Dr Mahathir-Anwar administration of the 1990s.

It is only a matter of time when Malaysia finally bids farewell to their era, but the challenge in addressing their negative legacy is daunting nonetheless.

If Anwar still aspires to contest the highest political office in the country, he must first and foremost review his past record and present a vision that would truly benefit the low-income group. Only by doing so can he distinguish himself from the conservative force that has just been returned to power.

Otherwise, why should the electorate reward his sense of entitlement with a chance to lead and to serve? – August 23, 2021.

* Josh Hong is a keen watcher of domestic and international politics, who longs for the day when Malaysians master the art of self-mockery. He has spent the last 15 years trying to win his feline friends’ favour as he considers it an endeavour more worthwhile than trusting politicians, aspiring also to be a tea and coffee connoisseur.

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  • Insightful.

    Posted 2 years ago by Jason Varughese · Reply