HUNG PARLIAMENT ECONOMICS EFFECTS

Samantha and Alief

On 19th November 2022, Malaysia had its 15th general election which resulted in a hung parliament for the first time in Malaysian history. A hung parliament is a term used to describe a situation in which no single political party obtained an absolute majority of legislators In Malaysia, a simple majority requires 112 seats. Despite Pakatan Harapan (82) being in the lead, they still lacked the necessary numbers to form a government. Since no single party was backed by 112 seats, the country found itself in a stalemate over the 5-day-period in which negotiations were being carried out. During this time, both Pakatan Harapan (PH) and Perikatan Nasional (PN) raced to form alliances in hopes of forming a government.

After almost a week of suspense and uncertainties, on the 24th of November 2022, Dato’ Seri Anwar Ibrahim was appointed and sworn in by the Yang diPertuan Agong, Al-Sultan Abdullah as the 10th and current Prime Minister (at the time this article was being written). Following this announcement, confidence in the Malaysian market proved to be rising - with many world leaders congratulating him. This seems to be an optimistic start for our newly formed government, but is this all just a facade?

To understand how a hung parliament works, let’s explore Britain’s 2010 General Election. The House of Commons consists of 650 members, known as the members of Parliament (MPs). A political party is required to obtain 326 constituencies to win a majority. In Britain’s 2010 General Election, no party was able to garner sufficient seats to form a government, despite the Conservatives being in the lead with 306 seats, followed by Labour Party (258 seats), and Liberal Democrats (57 seats). As such, the Liberal Democrats effectively became the kingmaker, playing a similar role as BN in Malaysia’s case Similar to Malaysia’s case, the United Kingdom also took 5 days of negotiations before Cameron was sworn in by Queen Elizabeth II. This led to the formation of the Conservative-Liberal Democrat coalition with David Cameron, leader of the Conservative Party as the elected Prime Minister

Unsurprisingly, the coalition was not without flaws, given the aftermath of the Great Recession at that time. For starters, the coalition had disagreements on dealing with the state of the economy. PM Cameron accused the Liberal Democrats of their indecisiveness, and Deputy Clegg countered that the Conservatives had unrealistic plans of cutting the deficit along with their action of making unfunded tax cuts. Both parties were also at odds over spending plans and tax rises. Amid the frequent ‘coalition at war’ headlines and the collapse of the government’s constitutional reform program due to their inability to reach a sustainable conclusion, most voters believed the government would not survive the 5-year term.

However, the coalition was able to defy the odds due to agreement on the main objective – fixing Britain’s deficit The coalition government was also able to survive due to fear of losing the next election if they were to bring down the government. It’s also refreshing to note that more transparency was created since decision-making had to be more evidence-based and required the agreement of both sides. In the context of Malaysian politics, this change could be seen as a balance in power and more transparency amongst politicians relative to a single-party government in the past.

The fall of BN in 2018 uncovered various scandals and corruption cases that were in the grey area to Malaysians because it wasn’t talked about enough. The people in power had the means to keep these cases on the low and this proved the great imbalance of power the 60-year government had in their hands. Ever since the change in hands of power, these cases have been on the headlines of many news outlets. More and more cases were brought to court so that the government could be free of corruption.

Now, our newly formed unity government consisting of several parties that were rivals is coming together to ensure the political arena of our country is stable so that they could focus on one common goal, continuity of economic development of our country.

Moreover, this means our unity government is going to have its check and balance regardless of what side they are on. Many might consider rivals forming a unity government will lead to uncertainties in decisionmaking and political instability but Prime Minister Anwar Ibrahim has insisted that the MPs should focus on the common goal of Malaysia as leaders of every party regardless of government or opposition, come together to work on the beloved nation.

Now, the question is left unanswered. How is this unity government going to ensure that we don’t suffer economic consequences from the potential economic instability?

The Budget 2023 was tabled back in October under former prime Minister Ismail Sabri and now lays the opportunity for Anwar Ibrahim to brand his government post-GE15 with amendments to the Budget 2023. Anwar has the chance to address the stability of his government by cooperating with BN on a common set of policy areas that they seem to introduce in their manifestos such as social safety nets, revenue resources, and realistic budget spending.

With Anwar ensuring this new government is playing its role to maintain political stability, it will be a strong government that could be here for the foreseeable future Decisions will be made with complete fairness and strong considerations as the government consisting of many different parties will act as the check and balance of the parliament. Not to forget the opposition side who have strongly insisted it will carry out the responsibilities of keeping the government in check despite the bitter defeat in the general election.

In the upcoming days before the first session of parliament is held, Anwar needs to structure the new amendments to our 2023 Budget to be more distributive as the economy is projected to spiral down next year. This will be more appealing to the people and gain traction among many Malaysians to keep the economy running while maintaining political stability and social harmony.

As strong advocates of economic stability and social harmony, we hope that this government would be a breath of fresh air to our country. The government needs to roll out its budget and socioeconomic policies soon to ensure they are delivering a message to all Malaysians to trust them in this period of uncertainty. This will be a new and exciting period for us to see how our country would thrive with our new leaders at the helm.