KUCHING, July 16: The Malaysian Trades Union Congress (MTUC) has again urged the government to extend the loan moratorium especially for targeted groups such as B40 and M40 workers as they have been the ones most affected by the economic downturn.
MTUC secretary-general J. Solomon reiterated on the need for the moratorium to be extended for the sake of hundreds of thousands of workers who have been rendered unemployed or forced to take hefty pay cuts and remain in dire straits.
“MTUC’s main concern is the welfare of workers, especially the blue-collar ones who lost their jobs as well as those forced to take pay cuts if they are forced to resume servicing their loans from 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 pointed out that they needed an additional six-month respite as the country needed at least that much time and more to get the economy ticking again while awaiting to go full throttle once the Covid-19 vaccine was made available.
“Various quarters including the MTUC have been calling for a six-month extension to the moratorium on housing, vehicle and personal loans which ends in September but, sadly, the government has not provided any clear decision on the matter.
“With September fast approaching, MTUC calls on the government to make a clear, unequivocal announcement on extending the moratorium or otherwise. The Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz must end the lingering ambiguity on this pressing issue,” he said.
As such, MTUC called on either Prime Minister Tan Sri Muhyiddin Yassin 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.
Solomon emphasised that official statistics indicating more than 800,000 people lost their jobs in the first five months of this year, should serve as a sobering reminder to the government and banks on why the moratorium must be extended by at least another six months.
Moreover, he added that 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.
“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.
“This means financial assistance such as the moratorium on loan repayments must not be yanked away from the rakyat,” he said.
Solomon also noted that much ado has been made of the fact that the six-month moratorium has businesses and individuals deferring payments worth RM51.4 billion on their loans so far.
“However, it must be pointed out that the moratorium does not in any way mean that banks have lost RM51.4 billion, as they will collect their dues down the line,” he added.
On whether the banks can afford to grant the extension, he said: “The answer must surely be yes as the government has often said the financial system has more than adequate liquidity.”
He added that Bank Negara Malaysia (BNM) had in May injected RM16 billion worth of liquidity into the banking system, saying it was part of its continuous efforts to ensure sufficient liquidity to support financial intermediation activity.
“We call on Tengku Zafrul and the government to show the initiative, zeal and commitment needed in getting banks to grant a further six-month extension to the moratorium on housing, vehicle and personal loans.
“There is also no better place than Parliament to debate the merits on extending the moratorium, especially for marginalised groups,” he said.
Solomon pressed that the government must act fast as MTUC feedback showed that the moratorium was uppermost on the minds of workers.
“Ending it 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 concluded.—DayakDaily