Malaysian Trades Union Congress (MTUC) today urged Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz to extend the ongoing bank loans moratorium for another six months. The MalayMail Online reports:
MTUC secretary-general J. Solomon said the congress’ main concern is the welfare of workers — especially blue-collar ones who have since lost their jobs due to the Covid-19 pandemic, as well as those forced to take pay cuts — when the moratorium ends in September and loan repayments resume in October.
“They simply cannot afford to do so and will be driven to take desperate measures including borrowing from loan sharks and incur higher household debts to repay their loans,” he said in a statement today.
Solomon added that since the current moratorium applies to all borrowers, regardless of their financial standing, the government must at the very least extend it for targeted groups such as B40 and M40 workers since they are most affected by the economic downturn.
Solomon also questioned Bank Negara Malaysia Assistant Governor Adnan Zaylan Mohamad Zahid’s remarks on July 3 when he said the central bank has no intention to extend the six-month moratorium for loans.
He said Adnan’s reasons for not extending the moratorium were “illogical and lack substance”.
Solomon said it remains unclear if the assistant governor’s statement was issued with the blessing of the Finance Ministry after it held talks with banks.
Earlier on June 28, Tengku Zafrul had said the ministry would engage banks on the matter, but stressed that financial institutions would not be forced to extend the moratorium.
“In any case, with September fast approaching, MTUC calls on the government to make a clear, unequivocal announcement on extending the moratorium or otherwise. The Finance Minister must end the lingering ambiguity on this pressing issue.
“MTUC calls on either (Prime Minister) Tan Sri Muhyiddin or Tengku Zafrul to address the matter in Parliament, as well as provide explanations to the elected representatives of the rakyat on the government’s final decision on the matter, whatever it may be,” he said.
Given that the situation remains critical for hundreds of thousands of workers affected by Covid-19, Solomon said the official statistics of over 800,000 people losing their jobs in the first five months of 2020 ought to serve as a sobering reminder to the government and banks on why the moratorium must be extended by at least another six months.
“MTUC has no doubt that the various industry players will also ask for the moratorium on their business loans to be extended as they try to get back on their feet. In all fairness, we feel their request has merit as well.
“Until international trade is restored and Malaysia’s main trading partners such as China and the United States are able to revive their economy to pre-Covid 19 levels, the local economy is expected to also remain in the doldrums and financial assistance such as the moratorium on loan repayments must not be yanked away from the rakyat,” he said.
In urging Tengku Zafrul and the government to do what is necessary, Solomon said there is no better place than Parliament to debate the merits on extending the moratorium, especially for marginalised groups.
“Ending the moratorium in September will bring untold misery and hardship to the rakyat. Extending it by another six months will provide a temporary financial relief which they desperately need to help lessen their despair,” he said.