It S A Budget Contraction Not Expansion

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“Honour is not measured by wealth, but by the courage and resolve with which one fulfils duty to the homeland,” Prime Minister Anwar Ibrahim quoted Pericles on budget day.
But, for the unprecedented inclusion of government-linked investment companies (GLICs), some federal statutory bodies, public-private partnerships and Minister of Finance Inc (MOF) companies in the budget, spending would have contracted by over seven percent.
Anwar, who is also the finance minister, got creative with the budget, including RM50.8 billion in investments by the GLICs and others into the spending, to make the budget RM470 billion, four percent over the previous year’s RM452 billion.
Exclude that RM50.8 billion, and the figure drops to RM419.2 billion. On a proper and fair comparison, the budget contracted by 7.3 percent, not expanded by four percent, a sleight of figures which showed a better picture than warranted.
Conjuring budget upwards
By a wave of the hand and a wag of the jaw, Anwar conjured the budget upwards through the inclusion of the following, which should have been excluded:
RM30 billion in investments by GLICs
RM10 billion in public-private investments; and
RM10.8 billion in investments by federal statutory bodies and MOF Inc companies.
International standards do not allow their inclusion in the national budget. But apparently that did not matter.
Truth be told, most budgets in Malaysia do nothing for better or worse - not significantly. We wring our hands a bit, winge some and accept it. The status quo remains, and we move on - just another day, another budget.
As many of his speeches are wont these days, Anwar got off the blocks with an inspiring, wise saying designed to evoke awe and wonder, this time from Pericles. I have quoted it at the beginning of this comment above.
There is nothing wrong with that - the trouble starts when he tries to equate that wise anticipatory riposte with what has been done to date. This is where failure becomes obvious. But like leaders everywhere who are out of touch with reality, he is oblivious.
Some examples
Let’s take some examples from his speech. “...we have more often than not chosen the harder road over the familiar one”. Really? When? Do we have targeted subsidies? Have we widened the tax base to get those who escape the tax net? Is there a goods and services tax? Are there measures to check evasion?
Here’s another one. “And why is the government steadfast in moving towards targeted subsidies? Because for years, blanket subsidies bled out to foreign nationals and large corporations. Subsidies are meant as a privilege for Malaysians.”
Despite government assertions, we don’t have targeted subsidies. Almost all, 99 percent of Malaysians who don’t use more than 300 litres a month, get full subsidies. It’s a blanket subsidy, not targeted. The rich pay as little as the poor. Foreigners pay full.
And that is not where the major leakage is. Cross-border smuggling, sale to foreigners and factories and on the high seas can continue because most of the population doesn’t consume 300 litres a month. They can sell what they don’t use to others.
A black market
A black market will emerge for RON95 petrol because pump prices remain at the subsidised level if you are Malaysian - no matter that the metered price is at RM2.60 a litre, the price that you pay is reflected in the bill - RM1.99 per litre.
Here’s one more from Anwar’s speech: “Why is enforcement so central to this administration? Because corruption, mismanagement and leakages have cost this nation dearly. When enforcement is carried out without fear or favour, what was lost can be recovered.”
Sure. But this is not being done without fear or favour. In some cases, it looks like it is done to induce favour and give favours instead.
Perhaps the greatest example of selective prosecution is the Sabah whistleblower case, in which many implicated are not being charged while others, including the whistleblower, have been targeted. This article about reports and counterreports says it all.
Targeting selectively
Sabah Deputy Chief Minister I Jeffrey Kitingan, who does not seem to want to play ball with the powers that be, seems to have been particularly targeted by the MACC for intensive questioning. The whistleblower questioned the PM’s response.
Sabah Deputy Chief Minister I Jeffrey KitinganIt was reported that former prime minister Ismail Sabri Yaakob and his aide won’t challenge a RM169 million forfeiture of money, raising the very legitimate question of whether there will be any charges pressed against the duo. So far, they have not.
And remember, Umno wants Najib Abdul Razak under house arrest and a pardon too, a move which appears to be implicitly supported by this government.
That’s more than enough to throw serious doubt on Anwar’s assertions that enforcement is being carried out without fear or favour.
Focused on appearances
The Madani government has focused more on appearances than actual doing, which will make a difference to the state of the nation’s finances and provide a foundation and framework for future growth and development for all the rakyat.
I promise, this is the last one: “At the heart of it, the reforms under Madani Economy are shaped around the rakyat. They were designed to guide the government in bettering public service delivery, creating jobs, opening income opportunities and easing the cost of living.”
Regrettably, there is nothing significant in the budget, the so-called rakyat’s budget, that we have seen in furtherance of this, apart from that little trick to make it appear as if this budget was expansionary when it was contractionary, by a large over seven percent.
Did Anwar act with honour and demonstrate courage and resolve to fulfil his duty to the homeland as Pericles urged? You can make your own decision with the irrefutable facts available to you. - Mkini
P GUNASEGARAM says we do too much for mere appearances.
The views expressed here are those of the author/contributor and do not necessarily represent the views of  MMKtT.

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