Price rise in the offing for Sabah?
Implementation of minimum wage from Jan 1 looks set to also leave a mark on the prices of goods and services in Sabah.
RANAU: A senior leader of the State Reform Party (STAR), Sabah chapter, has cautioned consumers that price of goods and services in the state are poised to soar higher in 2013 with the imminent implementation of “minimum wage” law of RM800 across the boards starting Jan 1.
STAR’s Sabah state committee member, Jalibin Paidi, said consumers in Sabah should expect the unpleasant surprises as businesses are expected to pass on to them the extra costs of doing business.
“The direct immediate effect of this minimum wage policy will be an increase of production cost for all employers in the state already burdened with the highest cost of living in Malaysia.
“Expect increases of prices of goods and services (of) anything from 20% to even 200% as the employers would definitely pass the cost to consumers at large,” Jalibin said in his statement in Ranau today.
“Already we in Sabah STAR have been receiving reports from industries that increasing prices of goods and services would inevitably be an option to offset the extra cost for minimum wage of RM800 in Sabah.
“Sabah consumers would be the worst affected by this policy as the gap from old wage to the new one will be the widest as Sabahans are also the least paid in Malaysia,” he said.
Jalibin, who was a school principal before resigning to be active in politics, said that many employees in various sectors in Sabah are paid around RM400 to RM500 a month in the resources-rich but poverty-riddled state.
The party, he said, had been told by those familiar with the restaurant, hotel, hardware, and supermarket sectors in various parts of Sabah that prices in almost all sectors would certainly be increased following the enforcement of the minimum wage policy.
“There are also to be expected some business owners (out) to exploit the situation by increasing prices at (their) whim and fancy but they are expected to respond to market forces once competition sets in,” added Jalibin.
There has also been no indication that the government will allow for grace period until June 2013 for employers with less than five employees on their payroll to delay paying the minimum wage.
“We are concerned on many fronts. No doubt we support higher wages for our under-paid labour force, but we must also have the mechanism to check employers who might try to terminate older staff and take in fresh workers in order to offset costs.
“This will result in unemployment for many and would also affect the quality of services to consumers.
“We are already on the receiving end of many bad things in Sabah, it is only right that the government is cautious when implementing a well-intentioned policy,” he added.
