Lukewarm response from MAH on Prihatin package

V. Sivaji | March 28, 2020 | 0 | Events , Happening Now , Spotlight

At RM250 billion, the “Prihatin” or Caring Economic Stimulus Package does indeed sound impressive, but industries directly impacted by the outbreak of Covid-19 may need a little bit more.

The extensive list of initiatives announced was very much focused on the people right at the end of the chain, with a series of cash handouts to ensure the wellbeing and livelihood of the people.

For the industries, particularly hospitality and tourism, the multi-level discount increases for electricity depending on consumption is much welcomed but the Federal Government is reminded again to ensure the same is being extended to Sabah and Sarawak, where energy is managed separately, not by Tenaga Nasional Berhad (TNB).

The announced payroll subsidy of RM600 per month for three months, for employees earning below RM4,000 a month, is needed but is below what the industry expected.

The hotel industry in particular, had earlier proposed a minimum of RM1,000 per employee, or a minimum equivalent of 50% of employee’s monthly pay for a period of six months.

This is in response to a much lower occupancy rate projected for the coming months looking the situation worldwide.

“We are looking at an average occupancy for Malaysia of nothing more than 25% in June, and that is if the Movement Control Order (MCO) ends on 14 April with the spread of Covid-19 under control,” explained Kamaruddin Baharin, President of the Malaysian Association of Hotels (MAH).

Recovery is not expected till the third quarter with the industry putting hopes in the year end holidays to ease up on accumulated losses for the year.

According to MAH, as of now 2,041 employees of the industry had been laid off due to economic pressures and the extended MCO, while 9,773 are given unpaid leaves and another 5,054 taken pay cuts.

This number is based on sampling size of 56,299 and is set to grow over the next few months.

Among others, MAH had also stressed on the call for banks to waive interests on top of the moratorium, and to reduce employers’ EPF contribution but both were not included.

Instead, employers are encouraged to consult EPF on restructuring, escheduling or postponement of contributions from 15 April onward.

“We will need to work with what is given now, and we will continue to engage and update the Government on the situation on the ground, if the initiatives are helping or if hotels are still forced to close given such unprecedented economic pressures,” added Kamaruddin.

He also cautioned that the world is still in a partial lockdown condition and there is no light at the end of the tunnel for tourism until a cure or vaccine is found.

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