On 27 October, Prime Minister Datuk Seri Najib Razak tabled the much-awaited 2018 Budget in Parliament.
There was plenty of goodies offered up this year, including the personal income tax cuts of 2 percentage points for those earning between 20,000 ringgit and 70,000 ringgit a year while the civil servants rejoiced in a RM1,500 bonus as well as the agriculture sector which received a RM6.5 billion boost to aid farmers, fishermen, smallholders and rubber tappers.
For young graduates struggling with a mountain of student loan debt, they were greeted with good news of discounts on outstanding PTPTN student loans and more time to enjoy payment discounts and new graduates have also been given a longer grace period before starting repayments.
What else did Budget 2018 offer young working adults?
To help youths in understanding how they can benefit from the latest budget, Malaysian Digest approached youths and youth leaders to gain their insight on Budget 2018.
So What Do Malaysian Youths Think Of The Budget?
For Ahmad Fikri, a university student in Kuala Lumpur, he is grateful for the continuation of the book vouchers that are intended to help university students in purchasing much-needed books.
“I just started my engineering degree a few months ago, and engineering books can be very expensive. With the RM250 book vouchers, it is easier for me to own them,” he shared with Malaysian Digest.
Fikri also noted on the relaxations for future PTPTN repayments, and he agrees with the government’s plan to extend the commencement of PTPTN repayments to twelve months after graduation.
“I consider it as an important responsibility to pay back my study loans. However, in this uncertain economy, it is hard to get a job even months after graduation.
“There is no telling on whether things will get better when I graduate in the future, but it is good to know that the grace period has been extended,” he opined to Malaysian Digest.
One of the main issues concerning the youth today is the housing issue. Many houses are expensive and are too much for an average youth.
“Fortunately, the government addressed the issue in this budget, and have put in place many plans to help youths to own homes,” said Muhammad Asyraf, a 26-year old living in Kuala Lumpur.
“The government is creating 210,000 units of affordable houses under the PR1MA programme, which will cost less than RM250,000 each. This is great news for people like me who are looking to buy their own homes in urban areas,” he said.
Besides the new houses, the PR1MA programme is also introducing a ‘step-up financing’ concept, that can be applied to private housing.
“I also welcome the 50 percent tax reduction for households that are renting earning less than RM2,000 a month. I think that will help a a lot for those in the B40 income group,” said Asyraf.
In addition to the programs above, the government is also creating 25,000 houses under the PPA1M programme for public servants.
For Justin Yap, one aspect of the budget surprised him, but in a good way.
“Datuk Seri Najib Razak introduced a scheme called Amanah Dana Anak Malaysia 2050 (ADAM50), where all Malaysian newborns from 1 January 2018 until 2022 will be granted with a Starting Fund of RM200 under the Amanah Saham in PNB.
“I did not expect such a policy to be introduced in the budget. It is definitely good news for me, as I am getting married next year,” he explained.
ADAM50 is the first time such a policy is introduced in Malaysia.
In general, many youth groups are happy with the 2018 Budget, but there are those who thought that the budget failed to address important issues.
According to the president of the National Islamic Youth Association (Pembina), Eqwan Roslan, the budget failed to come up with a plan to correct the various social ills that are affecting today’s youth.
“It is no use if we achieve materialistic goals, but at the same time we can see the rise in mental patients, children born out of wedlock, drug abuse, and foreign influences replacing our very own culture.
“The Malaysian youth and students are facing a worsening drug abuse problem, sex outside of marriage and confusion in self-identity. Pembina hopes the government will be serious in tackling these issues,” said Eqwan, as reported by ISMAWeb.
Despite the concerns, Eqwan complimented the government for creating many policies that would benefit the youth, and urge young Malaysians to take up the many opportunities provided by the government.
Budget Helps Address Many Of The Issues Faced By Youth
“In general, we think that the budget is quite a comprehensive budget for the youth. It covers a lot of aspects not only for the adults, but also for the younger generation,” said Roger Tan, secretary-general of the Malaysia Xiang Lian Youth group who shared his views on the recent budget with Malaysian Digest.
Firstly, he lauds the government’s initiative to help university graduates in paying back their PTPTN loans. In the budget, the government will provide discounts for PTPTN repayments until 31st December 2018. Among the discounts include:
- 20 percent discount on outstanding loan to settle repayments
- 10 percent discount for paying at least 50 percent of outstanding loan in a single payment
- 10 percent for payments via salary cuts or direct debit
The government is also providing more convenience for PTPTN loaners, especially those from B40 income groups who took courses with high marketability, RM200 million will be added to increase their maximum loans.
The grace period for graduates has also been extended to 12 months after graduation, compared to just six months previously.
“We know that youths who started working just after graduation, they will not have too high of a salary especially with the high cost of living these days. So we are thankful for the discounts in PTTN repayments,” said Roger.
For the students who wish to continue their studies after graduation, such as diploma graduates who wish to continue in degree studies, they can combine their loans from the previous and future studies, and they will only need to pay the loan after they have completed all their studies.
Besides PTPTN repayment, Roger also praised the tax cuts for the 2.3 million taxpayers in the country, especially for the M40 income groups who earn less than RM9,000.
“The government is reducing the income tax rate by two percent, especially for those who are earning in the range of RM20,000 to RM70,000 annually. This will greatly help they youth who are just starting their career, and increase their disposable income,” he explained.
The income tax cuts are as follows:
- For those who earn between RM20,001 to RM35,000, the rate will be reduced from 5 to 3 percent,
- For those who earn between RM35,001 to RM50,000, the rate will be reduced from 10 to 8 percent,
- For those who earn between RM50,001 to RM70,000, the rate will be reduced from 16 to 14 percent.
The government claims this move will increase the household disposable income by RM1,000 in each household.
Next, Roger notes that the government is committed in helping youth to get stable jobs in this tough economy.
“The government is creating a one-stop center that will assist the youth in finding stable jobs, as well as training them for precious skills,” he relayed to Malaysian Digest.
The one-stop centre will combine various agencies such as Jobs Malaysia, SL1M, PERKESO, HRDF and TERAJU in Urban Transformation Centers (UTC) to provide professional counseling service in securing employment as well as training.
One of the important issues that addressed in the budget was the challenges of Fourth Industrial Revolution, and the government wishes to provide the opportunity for youths to generate income even with the upcoming digital revolution.
“Programmes such as eRezeki, eUsahawan and eLadang encourages youths to venture into entrepreneurship if they can’t find a stable employment. These initiatives will kickstart businesses created by the youths.”
For example, the eRezeki programme provide training in using digital technology to develop businesses and also working part-time to gain additional income.
The rising cost of living is also one of the many issues plaguing the youths.
“Thankfully, the government is providing financial assistance in the form of BR1M to unmarried youths, up to RM450 to help them cope with high cost of living,” said Roger.
As a whole, he thinks the budget is a very comprehensive budget, one that will assist the youths as the generation that will lead the country in the future.
Budget 2018 Caters To The Needs Of Youths Of All Races
Malaysian Digest reached out to Datuk Armand Azha, the Exco for UMNO Youth and deputy chairman of GIATMARA, a government organisation dedicated to vocational education in rural areas.
He is optimistic with the latest budget by the Prime Minister, as the budget provides opportunities for youths to venture into business and and face the inevitable march of the Fourth Industrial Revolution.
“Many youths are taking the risk to establish a business instead of being employed, as many are utilising the wide approach of social media to spread their business.
“However, in my opinion, before the youth start their first steps as an entrepreneur, they should at least attend a business course and have an effective supervision to guide them in their business so that they can be successful and not failing,” he said.
As an UMNO Youth Exco, he sees the budget as consistent with the Dasar Transformasi Kesejahteraan Bumiputera (Bumiputera Prosperity Transformation Policy), where RM 3.5 billion has been allocated into the initiative in 2018, as well as more funding for people of all ages regardless of religion and race.
The Majlis Amanah Rakyat (MARA) will receive RM 2.5 billion for scholarships under the organisation, which is the largest funding it has received.
“RM 90 million is allocated for the Peneraju Profesional, Skil dan Tunas (Core, Skills and Professional Pioneers) programme that will benefit around 8,000 individuals amd RM200 million for MARA Graduate Employability Training Scheme (GETS).
“RM555 million is allocated for the improvement of Bumiputera entrepreneurship, which consists of RM200 million for Business Premise and Entrepreneurship Programme (PUNB), RM200 million for MARA Entrepreneurship Programme, and RM155 million for vendor capacity, Tunas Usahawan Belia (TUBE) programme, Skim Usahawan Permulaan Bumiputera(SUPERB) and Entrepreneurship Catalayst Scheme,” he said to Malaysian Digest.
Datuk Armand also emphasised that the Budget is not neglecting the needs of youths from other races. The government is providing RM50 million for Chinese youth who are venturing into small and medium enterprises (SME) via Koperasi Jayadiri Malaysia Bhd. On top of that, RM30 million is channeled to Yayasan Peniaga dan Penjaja Kecil 1Malaysia(1Malaysia Small Business Foundation) to give loans to Chinese businessmen.
As for the Indians, RM50 million is allocated into the Tabung Ekonomi Kumpulan Usaha Niaga under the Indian Entrepreneurs Development Scheme, benefitting more than 35,000 entrepreneurs.
Other entrepreneurship initiatives offered by the government include RM100 million for the eRezeki, eUsahawan and eLadang under the Malaysian Digital Economy Corporation (MDEC), and RM60 million for the 1AZAM program which can act as a catalyst for young entrepreneurs.
Besides that, the TEKUN programme is also receiving a boost of half a billion ringgit to assist young entrepreneurs in providing loans to kickstart their business.
“It is clear that the Barisan Nasional-led government is responsible and caring in creating policies that will benefit the young generation of Malaysians in entrepreneurship.
“In my opinion, to ensure that the young entrepreneurs will be successful, we must create a supervision system to guide them,” he concluded.