April 30, 2019



The new Government's move to revive the country's economy begins with the formation of the Government Advisory Council (GAC) on May 12, 2018. The Council comprises 5 national figures, Tun Daim Zainuddin, Tan Sri Zeti Akhtar Aziz, Tan Sri Robert Kuok and Prof. Dr Jomo Kwame Sundaram. The GAC serves as an advisor to the Government to restore the country's economic and financial position.

Nine months after that, on 11 February 2019 the Economic Action Council (EAC) was set up to stimulate economic growth and improve the well-being of the people. EAC has 16 members comprising several Cabinet Ministers, corporate figures and professionals with expertise in related fields. The EAC Secretariat is the Implementation Coordination Unit, Prime Minister's Department (Media Statement, Prime Minister's Office, February 11, 2019).

The establishment of GAC and EAC received numerous reactions from various parties. Generally, the question revolves around the inability of the both Councils in realizing the achievement of the stated objectives.

Question: Why after almost a year, both of these Councils were not able to restore the economy and improve the well-being of the people?

Answer: Malaysia's economy takes some time to recover. As an open market economy, growth and economic recovery are not only influenced by domestic but also by the influential global environment, not just the Malaysian economy but also other countries of the world.

Question: Will the newly formed EAC be able to function more effectively than the previous Council?

Answer: The EAC mechanism has no difference with the practice commonly used in government institutions and agencies. It has no internal operating structure to enable this entity to act effectively on 'action oriented' basis.

As with common practice in government institutions/agencies, all members of the Council are included in a meeting to discuss and propose major issues of national development. Meetings usually end up within 2 - 3 hours. Discussions and suggestions will be recorded by the Secretariat in the form of Minutes of Meetings that are usually too general to be translated and implemented by various agencies/ministries involved.

Such procedures will create constraints for EAC to perform the function as expected effectively.

Question: What needs to be done to enable EAC to perform its role effectively?

Answer: EAC needs to be established beyond bureaucratic rules. It needs to have a hierarchy with clear roles and functions for each level. For example, the hierarchy can be formed as in Diagram 1 below.

Executive Committee (EXCO). It is the highest hierarchy and is chaired by the YAB Prime Minister. The number of memberships is small, only involving those who have the authority to approve policies, programs and projects. The role of the EXCO is to review policy papers provided by the lower level hierarchy for immediate consideration and approval.

The Working Group consists of individuals and professionals in related fields. The role of the Group is to identify issues, problems and recommendations to improve the performance of related sectors. Information can be obtained through separate discussions with the captains of industry for the identified sectors.

Secretariat. The group comprises professionals and academicians with expertise in key areas, particularly for sectors, specifically focused by EAC, which is to stimulate economic growth and improve the well-being of the people.

The task of members in the Secretariat is to prepare policy papers based on issues, problems and proposals identified in the Working Group. Papers will be submitted to the Executive Committee (EXCO) for consideration/approval and implementation.

The Communications Team serves to provide information, explanations and briefings to the public and certain parties regarding the actions taken by the Government. The team also serves to get feedback from various parties for improvements and new proposals.

Question: Can we be confident that this ‘internal operating structure’ is effective in stimulating economic growth and improving the well-being of the people, as stated in the EAC goals?

Answer: No. EAC also needs support and commitment from implementing agencies at the Federal and State levels. This is important to enable approved proposals to be implemented quickly and effectively. It is also important for the coordination of implementation at various levels.

For this purpose, the Council shall be formed and consists of Central Agencies at the Federal and the Chief Ministers at the State level. This council only needs to meet occasionally.


The Economic Action Council needs to do away with bureaucratic practices in the public sector

In order to play its role efficiently and effectively, it is necessary that the Council has a hierarchical-based operational structure that outlines the clear function and role of each level and member of the Council.

The commitment of the implementing agencies at the Federal and State levels is necessary for the coordination of implementation at various levels.

Author: Dr Muzahet Masruri. Ph. D (Economics), University of East Anglia, United Kingdom.