To enhance consumer protection and consumer welfare, FOMCA proposes the following actions:

Enhancing Food Security
In the year 2005, the country’s food import was recorded at RM 17.7 billion while the food export amounted to RM 10.6 billion, translating into a deficit of RM 7.1 billion in the Balance of Trade in Food Stuff.  For its food requirements, Malaysia relies heavily on imports for the growing food demand.

Two systemic factors contributing to low food security in Malaysia, is the underinvestment in agriculture as well as the lopsided policy towards export crops at the expense of food crops.

1. Two ensure food security in the long-term FOMCA suggests:
2. Increase in public spending for agriculture and food
3. Development of  “idle” land through land consolidation
4. Enhancement of  credit facilities, especially for small farmers
5. Focusing  on Research and Development to enhance food productivity

Stabilizing Prices
Food and energy prices in Malaysia continue to increase to the determinant of consumer welfare.

While part of the price increase may be due to global forces, in many cases it is merely instances of trader profiteering. To minimize profiteering as well as to inform consumers of global changes affecting prices, a mechanism needs to be established that will study the price increases and seek to stabilize prices – that is to enforce against profiteering when price increase is due to traders taking advantage and to educate consumer when prices increases are due to global forces.

FOMCA thus proposes the formation of a Price Commission. The Price Commission shall be an independent, economic regulator which overseas, monitor and regulate prices of essential goods and services, especially in monopolistic industries.  It shall have the power to intervene to stabilize prices if there are instances of profiteering.

Enhancing Competition in the Market
FOMCA proposes that a Fair Trade Act be formulated to enhance competition the market place to benefit consumers.

The Fair Trade Act is based on the premise that competition drives companies to be more efficient and offer a greater choice of products and services at lower prices, thus benefiting consumers.  In a truly competitive market, companies face incentives to respond to consumers needs in terms of prices, product range and quality.

The Fair Trade Act is necessary to enhance the competition culture and to shape the competitive forces in the economy to ensure they enhance both development as well as consumer welfare.

We need both the Fair Trade Act and a stronger Consumer Protection Law for better protection and welfare of consumers. The Fair Trade Act achieves this indirectly through monitoring and maintaining competition in the market, while the consumer protection law does so directly without reference to the effects of competition.

The Fair Trade Act and through that deregulation and trade liberalization, there will be greater opportunities for entrepreneurs in the economy to compete on a “level” field and on the other hand, because of the competition, consumers would benefit for form lower prices, better quality and broader product range.
The Fair Trade is probably one of the most important legislation for the enhancement of consumer welfare in Malaysia.

Social Safety Net
As the government has begun the process of implementing the Goods and Services tax as well as the removal of subsidies for food and fuel, it is vital that the poor and the marginalized be protected from suffering as a consequence of both these programs.

Thus a comprehensive social safety net needs to in place, where the poor are identified and a regime of support and benefits as well as an effective delivery system should be put in place.

Among the benefits should be:

1. Hospitalization benefits
2. Unemployment benefits
3. Monthly pension
4. Special housing loans
5. Food subsidies
6. Education benefits

Improving Public Transport
Currently in the Klang valley, only 16 out of 100 use the public transport system, The government hopes to increase the usage of public transport to 25% by 2010,
The reasons are just too many –

1. Long unpredictable waits
2. frequent, unwanted stops
3. discomfort
4. complicated travel routes
5. unavailable information
6. differing payment structures
7. poor pedestrian friendly infrastructure
8. lack of park and ride

2 major problems with public transport

1. Fragmented regulatory system (13 agencies)
2. Lack of coordination

What is needed then is:

1. Single authority
2. Integrated system of LRT, Buses and Taxis
3. Limited number of companies – regulated competition
4. Bus lanes and other facilities
5. Safety and comfort
6. Proper information
7. More buses and train carriages – better organized
8. Affordable and reasonable fares
9. Management in low demand areas
10. Bus shelters and covered pedestrian walkways – connectivity
11. Effective Feeder bus system

Improving Healthcare
The government should maintain and upgrade the current healthcare system.  Privatized healthcare is making healthcare inaccessible and unaffordable to low-income consumers. Government needs to increase the allocation for public healthcare services to upgrade the quality of services. 

Consumer Education
Greater allocation need to given for consumer education to empower them to understand and provide skills to better adapt to today’s market.  The training programs should be focused on:

1. Communities
2. Schools
3. Workers
4. Youths
5. Women

Education should be informal and interactive.  Areas to be covered would include:

1. Rights and Responsibilities of Consumers
2. Sustainable consumption
3. Financial management
4. Making Effective Complaints
5. Media Literacy

The best form of consumer protection is still self-protection. Self-protection is enhanced through knowledge, skills and self-confidence.

NGO Funding
More funding should be allocated to Consumer Organization to enhance their roles in:

1. Consumer Research and Advocacy
2. Complaints Redressal
3. Consumer Education and Training

Prepared in July 2010