Empowering the Third Sector for Better Healthcare, Education, and Society

Hari ini saya berdiri di sini dengan perasaan bercampur, iaitu sedih atas pemergian tokoh negara Tun Dr Siti Hasmah Mohd Ali semalam, tetapi tetap bangga kerana kita berada di dalam dewan Auditorium ini yang mengambil sempena nama Allahyarhamah. 

Ketokohan Tun Dr Siti Hasmah tiada tandingannya, terutama sumbangan besar Allahyarhamah dalam bidang kesihatan awam, khususnya bagi wanita dan kanak-kanak. Malah, beliau merupakan salah seorang doktor wanita pertama di Malaysia. Salam takziah kita sampaikan kepada Tun Dr Mahathir Mohamad sekeluarga.

Terlebih dahulu, saya mengucapkan terima kasih kepada Sub-Committee on Non-Profit Organisations, atau SCONPO, atas undangan ke majlis hari ini. Saya juga ingin mengucapkan tahniah kepada Lembaga Perkhidmatan Kewangan Labuan (Labuan FSA), selaku Pengerusi Semasa SCONPO, serta semua agensinya atas penganjuran Simposium Kebangsaan Pertubuhan Bukan Berasaskan Keuntungan 2026 (SIMPOSIUM SCONPO). 

Saya difahamkan bahawa simposium ini telah dianjurkan pada tahun 2013, 2017 dan 2024. Adalah menjadi harapan saya agar simposium SCONPO dapat terus dianjurkan setiap tahun. SCONPO merupakan sebuah badan yang beroperasi di bawah Jawatankuasa Penyelaras Pencegahan Pengubahan Wang Haram Peringkat Kebangsaan (National Coordination Committee to Counter Money Laundering, NCC) yang berperanan menyelaraskan usaha berkaitan sektor badan bukan berasaskan keuntungan (NPO) di Malaysia bagi memperkukuhkan tadbir urus, mengekalkan integriti, dan meningkatkan kebolehpercayaan awam terhadap sektor tersebut. 

Usaha ini dilaksanakan melalui penyelarasan dasar berasaskan piawaian antarabangsa Financial Action Task Force (FATF), perkongsian maklumat serta pengukuhan kerjasama dan penyelarasan antara agensi berkaitan. Usaha ini juga didorong oleh kerisauan NPO disalahgunakan untuk membiayai aktiviti-aktiviti terorisme.   

NPO di Malaysia boleh ditubuhkan dalam bentuk kelab, pertubuhan dan persatuan, syarikat berhad menurut jaminan (CLBG – company limited by guarantee), amanah atau yayasan. Setiap jenis pertubuhan tertakluk kepada undang-undang, peraturan dan pihak pengawal selia yang berbeza, seperti Lembaga Perkhidmatan Kewangan Labuan, Jabatan Pendaftaran Pertubuhan Malaysia, Suruhanjaya Syarikat Malaysia, dan Bahagian Hal-Ehwal Undang-undang. 

Empowering the third sector

The origins of SCONPO works were driven mainly by the urgent needs among domestic and international regulators to prevent NPOs from being used as channels to finance terrorism, and other illicit and illegal activities. 

And, as the regulatory powers are scattered among various agencies, SCONPO is an attempt to coordinate a more harmonised and synchronised approach towards the NPOs. There are also pressing concerns about scams, cybersecurity, foreign influence operations etc which will need to be dealt with. Those are necessary foundations of our work here in building a more robust and resilient NPO sector.

I would like to take this opportunity to get everyone here to ponder about the future of NPOs in Malaysia, and how we can tap the NPOs to build a more humane Malaysia, and a Malaysia that is less based on commodificating and financialising every aspect of our lives. Because I believe not every part of our social lives should be a profit-oriented activity. 

Recently, someone asked if I would support an insurance scheme to help pay for funeral expenses, especially for non-Muslim, as funerals have been commodified to become a multi-billion dollar business. 

I was furious when I heard this. We should address the root causes, and not create an insurance scheme to help pay for such expenses. 

Harvard Professor Michael Sandel in his book What Money Can’t Buy explained why societies should prevent the commodification of everything in our daily lives.

The late Peter Drucker in his book Managing the Non-Profit Organisation defined the non-profit sector as the third sector – distinctively different from the first sector (private business sector) and the second sector (the government sector). He argued that the third sector is essential for a functioning and healthy society. 

Today, I would like this audience and the wider Malaysian policy community to look at the NPO sector as the third sector, and as the one that could play a significant role in our everyday lives, potentially as important as the public and business sectors, in certain contexts. 

Empowering the third sector will help Malaysia to move beyond the public sector versus for-profit private sector dichotomy. I would like to discuss the role of the third sector in healthcare and education. 

Our healthcare and educational institutions enigma

The Malaysian healthcare sector is now facing a dire situation. We have a two-track system. Typically in a two-track situation, by the rule of thumb, the public track has 30% of medical resources including doctors and takes in 70% of patient load; while the for-profit track has 70% of medical resources with 30% of patients.

According to Dr Sean Thum in his book Health, Harapan and Healing Malaysia, misallocation of resources and lack of investment in doctors and nurses over the past decade or so have resulted in immense pressure on the government system.

At the same time, a confluence of factors after the Covid-19 pandemic including private hospitals gaming the insurance system leading to medical insurance premiums rising rapidly, reaching a very critical level in 2024 that prompted Bank Negara to impose a three-year moratorium. More than 500,000 insurance policies were cancelled, resulting in those previously dependent on the private hospitals now flocking to the public hospitals. 

Bank Negara, the Ministry of Finance, and the Ministry of Health have collaborated to introduce MediASAS, which will be launched in January 2027, which among other things would define “Tier 1” hospitals as those which are more transparent in fees and unlikely to game the system, and “Tier 2” as “premium”. 

This is indeed an opportunity for us to see the “Tier 1” as a “social market” in which more NPOs can be brought into providing health care services that are affordable, and supported by MediASAS. 

Author Dr Tan Hui Ling pointed out in The Edge that most early Malaysian hospitals were actually charitable hospitals, such as Tung Shin and Assunta. (https://theedgemalaysia.com/node/818025) 

According to Dr Sean Thum in his article Building a social market for Malaysian healthcare (https://theedgemalaysia.com/node/818448) 

“A Social Market provider does not necessarily have to be privately owned, just as public ownership does not automatically guarantee efficiency or value. 

“Such providers could include conventional private hospitals willing to operate according to Social Market principles, NGOs or social enterprises, differentiated services operating within public facilities as initiatives such as RakanKKM evolve, or potentially institutions supported by long-term capital from government-linked investment companies and other institutional investors.

“What should define their place within the Social Market is not who owns them, but whether they can consistently deliver quality healthcare efficiently and affordably.” 

The same applies to educational institutions. It is unfortunate that in the Private Higher Education Institutions Act 1996, while the definition of “private higher education institutions” does not specify that they are profit-oriented organisations, Clause 12 spells out how an institution should be incorporated as a share-owning corporation, which is usually interpreted as profit-making organisations in practice. 

NPOs should be included in our thinking about the provision of higher education, and should serve as a viable alternative to profit-making organisations. 

Reject commodification and financialisation of everything

Breaking the dichotomy between government and business tracks in health, education and many other provision of services through putting the NPOs – the third sector – prominently should be the new agenda of our time. 

The third sector will help us to reduce the commodification and financialisation of our lives, and therefore improve the quality of life of the many while reducing the financial burden of the middle class and beyond. 

Returning to my point about expensive funerals, it is time for us not to accept the commodification and financialisation of various aspects of our lives as given and cast in stone.

I understand there are ongoing efforts by BHEUU to enact a Charity Act, which is a timely endeavour.

Let a robust NPO sector be the catalyst for a more humane Malaysia that puts solidarity as its central value. It is with this aspiration that I hope SCONPO will be further formalised, and with a sense of higher mission to change Malaysia for the better.

This is my keynote address delivered at the National Symposium on Non-Profit Organisations 2026 organised by the Sub-Committee on Non-Profit Organisations (SCONPO) on Wednesday, 30 September 2026 at Tun Dr Siti Hasmah Auditorium, Menara SSM, Kuala Lumpur.