 KUALA LUMPUR: The government could look into the possibility of offering low-income households a discount card to buy their daily essentials to replace 1Malaysia People's Aid (BR1M), said an economist. "Human nature is that if they get extra money upfront, they may use the money for unproductive spending," said Alliance Banking Group chief economist, Manokaran Mottain, referring to the government's scheme of offering cash handouts for households earning less than RM3,000 a month. The idea of a discount card, which can be incorporated into the Mykad, is to let poorer households to enjoy discounts for their shopping on groceries and fuel and this appears to be a longer-term solution over BR1M, he said. He made the comment as a panelist at a panel discussion last night by the British High Commission here and University of Nottingham Malaysia, entitled "No Pain No Gain: Cutting subsidies is necessary for Malaysia's future prosperity." Manokaran said despite the people facing the pressure of the rising cost of living, the subsidy rationalisation was needed as Malaysia has to broaden income sources to ensure a better fiscal position. "Malaysia has to safeguard itself from a rating downgrade or else foreign capitals will get out of the country, which will impact our current account and currency," he said. Minister in the Prime Minister's Department Datuk Seri Abdul Wahid Omar, who was one of the panelists, said there was a need to rationalise subsidies to bring down the government's budget deficit in order to achieve a more sustainable economy. "The savings from subsidy rationalisation can allow the government to spend on improving public transport, and offer targeted subsidies to enhance the social safety net, among others," added Abdul Wahid, who is in charge of the Economic Planning Unit in the Prime Minister's Department. -- Bernama
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