ESH gives boost to economy: JPKE

THE recent distribution of the 'Elaun Sara Hidup' (ESH), or Cost of Living Allowance has given the local economy a shot in the arm since its payout a senior officer from the Department of Economic Planning and Development (JPKE) said.

Abd Amin Hj Hashim, the Deputy Director-General of JPKE said that, although temporary, the actual impact of the ESH on the local economy could only be determined once the quarterly report of Brunei's gross domestic product (GDP) is released by October.

He said that the amount of ESH was more than what the civil servants would be receiving during annual bonuses and that "the impact is multiplied by that amount".

"At this moment it's quite difficult to make a fair assessment of the impact. Of course on the ground we see all roads pointing to shopping areas. You know what it means," he said during a phone interview with The Brunei Times yesterday.

The Deputy Director-General said that massive traffic jams in commercial areas and shops could be seen over the past two weeks a clear evident that government workers are spending their money within the country.

He added that this indicates that the people have began their Hari Raya shopping as the festive season is nearing and that the ESH provides an additional means for those on lower pay scales to do so.

"On whether people are spending wisely or not, the answer is maybe....some people really are buying kitchenware or furniture for Hari Raya," he said, when asked whether civil servants had been spending their money prudently.

"But big chunk of that (ESH) is for people in the lower wage group and therefore the kind of consumer products would possibly be different from those bought by middle to high income groups."

Abd Amin also said that while some civil servants could be seen purchasing electronic gadgets and mobile phones, which is possibly less important during the Hari Raya season, there were people who have been making proper use of the ESH.

He said that the department would be compiling a comprehensive report to study the sales trend for this period of the year.

"(Once the report is out), we can see how the second quarter of this year differs from the same quarter of last year."

When asked if the ESH has given a boost to the local economy, he said: "Definitely yes".

However, he conceded that any spike in the sales records would surely go back to normal.

"It is not sustainable, people will just spend their (extra) money (until it finishes) then the economy will revert back to normal," he said.

He related that this sudden but temporary upward trend in sales record within the local economy will not play a significant part in the next GDP.

"It's something positive but not remarkable and significant as it is short-term", the deputy director-general said.

In 2009, the Prime Minister's Office (PMO) announced that the 25 per cent of the ESH that had previously been withheld would no longer be deducted off civil servant's wages.

The 25 per cent, collected monthly, was meant to be an additional contribution to the Employees Trust Fund (TAP) to ensure better security when employees retire.

The PMO, had in March this year, issued a directive for the early release of the ESH savings.

The ESH varies with salary with those on lower salary scales receiving higher amount.

For example, civil servants who earn between $1,550-$2,290 a month typically receive $120, while those in the $1,105-$1,825 salary bracket would receive $170 .The Brunei Times