KUALA LUMPUR: An opposition MP has proposed that the government subsidise small businesses for seven months to help them pay their workers the new RM2,000 wage, instead of exempting them from the increase.
Debating the 2027 budget in the Dewan Rakyat, Ahmad Fadhli Shaari (PN-Pasir Mas) said the scheme would start with 500,000 workers at micro, small and medium enterprises (MSMEs), with the government topping up RM300 per worker.
At RM300 a month, he estimated that the subsidy would cost up to RM150 million a month, or RM1.05 billion over seven months, excluding administrative costs.
Fadhli argued that exempting smaller companies from the new minimum wage would mean their workers continued earning RM1,700 a month, while those at bigger companies earned RM2,000.
"However, this exemption does not solve the root problem. Instead, it risks creating two groups of workers with different minimum wage rates,” he said.
"This is a bad impact on employment. It could cause skilled workers to move to big companies, making it hard for MSMEs to retain workers and ultimately hurt their competitiveness."
To finance the subsidy, Fadhli proposed cutting the RM3.8 million allocation for each government MP in 2027, which he said would save RM581.4 million.
“From that alone, we would save more than half a billion ringgit from the allocations given to government MPs,” he claimed.
He said the remaining money could come from cuts to other government spending, including the Prime Minister’s Department, whose allocation he said had increased from RM10 billion to RM11.6 billion.
Under the 2027 budget, the minimum wage will rise from RM1,700 to RM2,000 next June, but businesses with annual sales below RM50 million will be exempted.
Opposition leader Hamzah Zainudin raised similar concerns yesterday, warning that the exemption would create unequal pay among workers.