The Distracting Bilateral Issue of Maids

I am surprised at the high level of engagement in this maid issue. If only a similar commitment were made in luring foreign academics and skilled workers, imagine the good it would do to Malaysia!

By M. Bakri Musa

It is telling of the state of development for both Indonesia and Malaysia that when their two leaders met recently, the key topic was Indonesian maids. Malaysia wishes to import more while Indonesia wants better working conditions for its workers in Malaysia.

I would have expected the two to discuss such consequential issues as jointly developing the region as a tourism destination to rival the Caribbean, harnessing the power of satellite and wireless communication to leapfrog the development of both countries, or perhaps conducting joint maritime research for both ecological and economic purposes. Alas, none of that!

It is reflective of the abysmal state of human development in Indonesia that maids are its major “export.” Likewise, it reflects the perverted status symbol of Malaysians that they consider having a maid as a necessity for a “luxurious” lifestyle.

It is beyond me why Malaysians think that way. Australians have a per capita income considerably higher, yet I do not see them having a “maid crisis;” likewise the Japanese. Even in America where it is now the norm for both parents to be working, very few homes have live-in maids; most do with only daytime helpers. Granted, there are many childcare centers to take up the slack.

In America, those maids (nannies) get social security benefits (America’s Employee Provident Fund – EPF) as well as workmen’s compensation insurance (for work-related injuries). They are also governed by prevailing labor laws. As can be seen, slavery is long gone in America.

While conditions for maids in Malaysia are far superior to the old American slaves, nonetheless the family-servant dynamics in Malaysia is closer to the owner-slave mentality of the Old South than to a modern employer-employee relationship.

I am surprised at the high level of engagement in this maid issue. If only a similar commitment were made in luring foreign academics and skilled workers, imagine the good it would do to Malaysia!

If Malaysia were to continue importing maids, then I would suggest imposing strict standards and paying them attractive salaries. We can begin by calling them “nannies” instead of the degrading “servants.”

The minimum monthly salary should be RM800.00, with overtime rate twice that on a prorated per hour basis. Additionally, the employer would contribute towards the nanny’s EPF. Those funds would become vested (meaning, the nannies could claim the benefits) only if they were to serve cumulatively for at least 40 quarters (equivalent of ten years), though not necessarily continuously or even with the same family. This is the rule with America’s Social Security.

As for work hours, they must have at least an eight-hour stretch of undisturbed time in a 24-hour day period, and an additional 24-hour in a seven-day period. Of course they can choose to work during those times, but they would be paid overtime.

The employer would also have to pay 10 percent towards health insurance, and another 20 percent towards a “performance bond.” The pooled money in the bond would pay for any maid caught in a criminal activity. It would also cover the cost of the loss as well as deportation. The bond funds would also benefit the nanny should her employer for some reason is unable to pay her salary, as with the employer declaring bankruptcy.

Thus it would cost at least RM1,200 per month to employ a nanny. Such a remuneration would make not only the Indonesian authorities happy (that is always a good neighborly gesture) but also those nannies. Heck, at that rate we may even interest locals to become nannies!

For those who think that such a pay rate is unrealistic, consider that the average expatriate family in Malaysia is already paying considerably more. Of course the services provided to those families are considerably superior than what Ahmad and Ah Chong are getting.

To justify the higher pay, these maids must provide superior services. They must be properly trained to do that. They must take at least a three-month course learning basic hygiene and the rudiments of safe and healthy childcare. This would include basic nutrition, child safety, and child proofing the house, including training in cardiopulmonary resuscitation and Heimlich maneuver.

All these would cost money and beyond the reach of the potential typical maid from an Indonesian village. However, the government, using funds from the performance bond, could finance these courses. They would be free if the attendee were to work in Malaysia for at least three years, enough time to recoup the costs of training. Such a scheme would benefit not only potential employers but also these young women. When they return to their villages they could then take better care of their own children or grandchildren.

Of course the government could ease the need for these foreign maids (and thus save on the associated social and other costs) by encouraging the setting up of childcare centers through various incentives.

More Fruitful Avenues for Cooperation

Despite the space devoted, it is not my purpose to write on how to get better maids. Instead my focus is on exploring areas of potentially fruitful cooperation between Malaysia and Indonesia. In my book Towards A Competitive Malaysia, I proposed greater economic cooperation leading to integration a la the European Union between Indonesia, Brunei and Malaysia (a political IBM!).

While all three are still essentially developing and thus would be competing in the same arenas, nonetheless there are sufficient differentiating factors between them that would make cooperating more beneficial than competing. The potential areas for cooperation include energy (oil and gas), plantations, tourism, wireless technology, and natural products development.

All three are oil and gas producers. Individually they are no match to the slick “seven sisters” oil companies, but collectively IBM could be a powerful countervailing force. While Pertamina and Brunei National Petroleum are still babes in the wood, Petronas has acquired significant international expertise.

With plantations, Indonesia has plenty of land in Sumatra and Kalimantan as well as labor, while Malaysia has the sophisticated experience. Brunei of course has the financial capital; at least what is left after its profligate sultan has his bite.

As for tourism, the area could rival the Caribbean as a tropical paradise for rich cold-climate dwellers. It is just as arduous to fly from Frankfurt to Cancun or St. Bart as it is to Bali or Langkawi. As in the Caribbean, I envisage four or five major cruise companies serving the area.

The Malay Archipelago with its endless islands is an ideal place to test the limits of and potential for satellite and wireless technology. Imagine if we were open up the whole area to global competition and let the likes of Nokia, ATT, Nippon Tel and Siemens compete. Once we have reliable real-time communication from Sulawesi to Seremban, and from Lubbock to Langkawi, then watch as trade and other economic activities flourish.

Likewise, imagine if we were to open up the region’s airspace to all comers, domestic and foreign. Who cares if the companies are foreign; all we are interested is affordable, reliable and efficient service. Those who can will stay and survive; those cannot, will leave.

As for natural products, both Indonesia and Malaysia still have vast tracts of ancient jungles that have yet to be explored. What is lacking is the expertise to exploit this invaluable resource and the political enlightenment to treat it wisely.

These are only some of the potential areas for cooperation. The issue of maids pales in comparison.

Indonesia’s Susilo Bambang Yudhoyono holds a PhD in economics, while Najib Razak is generously described as a “British-trained economist.” This makes it all the more incomprehensible why they would be involved in dealing with such trivia as the maid issue.