Thursday, January 22, 2015

Budget 2015: A Revision

On Monday, Prime Minister Najib Razak (also the finance minister) passed the verdict that the Malaysian economy will remain positive and won’t be in deficit. In fact, he bravely denied there was an impending crisis. In the same breath, however, he announced a revision of Budget 2015.

The highlights are as follows:
Putrajaya’s projected operating expenditure of RM273.9 is to be slashed by RM5.5 billion.  The GDP growth target is at 4.5%-5.5% this year from 5%-6%.
The current account will remain in surplus but smaller at 2%-3% of GNI.
The fiscal deficit target in 2015 is revised to 3.2% of GDP from 3%.
Reduced forecast for baseline oil price to $55 per barrel from $100 per barrel.
The development expenditure of RM48.5 billion will be maintained.
Government revenue at RM222.9 from RM235.22 billion.
The government expects additional RM1 billion in GST collection.

Just looking at the numbers above, I get even more worried. They reflect a lack of understanding of how languid the economy is, a lack of appreciation of how bad the economy can get and a lack of precaution on how to deal with the economy when it goes downhill. 
Operating expenditure remains high. Cropping it by a miniscule 2% is not really going to do anything at all.
Why won’t Najib consider performing a liposuction on our bureaucracy? May I suggest we target the Prime Minister’s Department? Having ten Ministers is a joke.

PKR’s Rafizi Ramli had claimed that their discretionary budget could be as high as RM7 billion!
And better still, if we had taken corrective action as per the recommendations made in the 2012 and 2013 auditor-general reports on wastages in government spending – it is asserted that Putrajaya could save up to RM30 billion.
Already, we are passing through challenging times. And not to mention the hostile global conditions that hang over us like an overcast sky of oppressive severity.
But Najib seems to think the country is in good hands. All because he holds a degree from UK’s Nottingham University – which means he knows how to mismanage our economy! Oops, I mean “manage”.
The pessimists amongst us are the villains because they exaggerate about our economic entanglement and worse, they paint a bleak doomsday picture of the country.
Najib reminds me of MAD’s Alfred E Neuman (left) and his famous phrase “What, Me Worry?” He doesn’t believe our fiscal problems are a big deal. He thinks Malaysians should be able to cope, come what may.

We can survive on RM1 chicken and kangkung – so, what's the problem?
On Monday, I was in Jalan Puteri 2/1, Bandar Puteri in Puchong, Selangor to take up the role of General Evaluator at the Puchong English Toastmasters meeting. I last visited the club on July 07, 2014 which was some time ago and it was really nice to be back there. A good meeting and my score is a 7 over10.


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