The Jeffrey Cheah Institute on Southeast Asia (JCI) in partnership with the Asian Strategy & Leadership Institute (ASLI) and Sunway Institute for Global Strategy & Competitiveness (IGSC) recently co-hosted a forum on ‘Multidimensional Poverty in Malaysia: Key Challenges & The Way Forward’. The objectives of the forum were to discuss the current policy challenges and develop new key policy strategies to alleviate current and mitigate emerging poverty dimensions in Malaysia.
Moderated by ASLI CEO Danial Rahman, the session featured prominent leaders and experts consisting of Tan Sri Sulaiman Mahbob, Board Member of Malaysian Institute of Economic Research (MIER); Prof. Jomo Kwame Sundaram, Research Advisor at Khazanah Research Institute; Prof. Mahendhiran S Nair, Pro Vice-Chancellor (Research & Sustainability) at Sunway University; Dr. Muhammed Abdul Khalid, Research Fellow at Institute of Malaysian & International Studies, Universiti Kebangsaan Malaysia; and Professor Dr Tan Sri Noorul Ainur, Professor of Practice at Jeffrey Sachs Center on Sustainable Development, Sunway University.
There were several key policy strategies and challenges discussed at the forum. The key highlights of the forum includes:
The historical policy structure and framework of anti-poverty policy formulation was highlighted by Tan Sri Sulaiman. The initial anti-poverty policies included the government’s efforts to develop a methodology to measure poverty, tracing the formulation of the national poverty line income (PLI) to its recent focus on the “B40”, which constitutes the poorest forty percent of the population. As the initial policy formulations were based on the challenges of 1990s, Tan Sri Sulaiman stressed the need for poverty measurements to maintain its relevance in an age of new issues such as urban poverty and the rise in cost of living.
The need for policy coordination across ministries, academia, and private sectors was highlighted by Professor Dr. Tan Sri Noorul Ainur. Introducing the quadruple helix model, she stressed the need for collaboration between the government, academia, industry and citizens in order to drive structural change for entrenched issues such as multidimensional poverty. The need for current information and data was highlighted in the discussion with an overview of the government’s financial assistance schemes for the poorest 40 percent from 2022-2024. Professor Dr. Tan Sri Noorul pointed out that despite the large number of schemes, these initiatives were blunted in their impact as government departments often worked in silos with minimal collaboration and coordination – this is despite the multidimensional and cross-cutting nature of poverty. In fact, there are large overlaps in the functions and responsibilities across ministries. There is no lead ministry to manage, monitor, and evaluate overall anti-poverty strategies at the national level and across the involved ministries. This situation is compounded by the fiscal constraints of public funds, with ministries only able to operate within the constraints of their respective individual budgets instead of consolidating larger resources together.
The multidimensional issues of poverty and the need for cross-cutting polices was highlighted by Professor Jomo Kwame Sundaram. Professor Jomo highlighted the tendency to overemphasise monetary income in measuring multidimensional poverty. Labelling it the ‘fetishisation of cash’, Prof Jomo argued that while numerical measurements of poverty vis-à-vis income can be useful, it can also be deceptive. For instance, people can be earning above any arbitrary poverty line, but still be considered “poor” in other aspects, especially in the current open and globalized economy. Prof. Jomo cited a study he carried out in Southern Kedah, where children of rice farmers were healthier in terms of anthropometric measures compared to children of rubber smallholders who earned a higher income. He said that higher incomes do not mean higher wellbeing, as exemplified by Putrajaya’s high rates of child malnutrition despite its status as one of the richest states in Malaysia. Professor Jomo also commented on recent efforts to construct a single composite index to measure multidimensional poverty, arguing that such indices may obscure much more than they reveal as people experience deprivations in different ways. Instead, he favours a dashboard approach that would not erase the local and contextual nuances of deprivations.
The role and need for private sector involvement in poverty alleviation in Malaysia was highlighted by Prof. Mahendhiran S Nair. He provided the case study of the Desa Mentari project, an urban poor locality of 26,104 residents, where which faced a “poly-crisis” of multifaceted challenges. While there existed many initiatives, there was very little impact on the community’s wellbeing due to solutions being too one-dimensional and siloed. The initial research found that the key priority issue amidst this “poly-crisis” was access to education, training and competency, which in turn impacted access to jobs and better incomes. Recognising this, Sunway University partnered with Sunway Group, other corporate entities, government agencies, and community organizations to establish a variety of educational pathways across formal, informal and skills-based dimensions. This includes programmes encouraging the acquisition of ICT and entrepreneurial skills, establishing accessible tuition centers and after-school programmes to provide support for children & youth, and increasing spaces for extra-curricular activities, sports and health-related programmes. Prof. Mahendhiran cited this as an example of how a values-driven development model, which is a contrast to the “return of investment” type of models which looks at income alone, can transform a “poly-crisis” to “poly-opportunities”.
The new emerging issues of poverty in modern society was highlighted by Dr Muhammed Abdul Khalid. Although Malaysia has done very well post-Independence to tackle poverty, new challenges have emerged. For example, stunting among Malaysian children is not just comparable to Cambodia, but is now worse than its 1999 level. Many Malaysian children also experience “learning poverty”, with high failure rates in English and Mathematics based on last year’s national high school examination results. He emphasised that government policies must align with national aspirations, to prevent conflicting policy mismatches such as subsidising sugar while trying to reduce obesity and diabetes. Instead, there needs to be more focus on increasing wages across the board in Malaysia. He pointed out that the T15 classification for the top fifteen percent of earners tends to obscure the low incomes and financial vulnerability of many Malaysian households.
In summary, the forum speakers highlighted the need for:
A coordinated effort to manage and mitigate multidimensional nature of poverty. There is a need for a leading ministry to coordinate anti-poverty policies across agencies and the private sector;
an updated and overall database that allows to create leading and forward-looking indicators for poverty measurements that could be adopted across the ministries, thereby reducing policy overlaps and coordination; and
a new framework to monitor and evaluate the new poverty challenges emerging from globalization and technologies, as market-based policies have less and uneven impact on labour market and workers, increasing their vulnerability to economic shocks.
