Thursday 28 Mar 2024
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KUALA LUMPUR (March 27): The extra RM3.08 billion that the government is seeking from the Supplementary Supply (2016) Bill 2017 is not going to affect Malaysia's fiscal deficit of 3.1% that year, said the Ministry of Finance.

In wrapping up his speech on the supplementary budget today, Second Finance Minister Datuk Johari Abdul Ghani said the extra monies are related to government's 2016 operating expenditure (OE).

Johari said the actual OE spent last year was RM2.25 billion less than the budgeted RM215.2 billion.

"So we transferred RM2.25 billion to DE (development expenditure), but in government's accounting method, we cannot just transfer like that, we need to make disclosure like the supplementary bill today, so that is not actually a spending," he said.

Under the Supplementary Supply Bill, the biggest item is RM2.25 billion 'contribution to statutory funds', followed by Education Ministry (RM297.96 million), Transport Ministry (RM215.71 million), Women, family and community development Ministry (RM128 million), Health Ministry (RM104.4 million), Election Commission (RM62.78 million), and Foreign Affairs Ministry (RM24.13 million).

"The RM2.25 billion is not actually a spending in OE, but the others, yes, they are actual spending, totalled RM832.98 million, but these are under Contingency Spending in Budget 2016, which have been approved by this Noble Parliament back in October 2015," Johari said.

"For Contingency Spending, it is meant to facilitate our spending [for unforeseen events], we don't usually itemise them during Budget presentation. So this supplementary bill is merely to itemise these spendings," he said, adding that a snap election is an example of such unforeseen events.

Therefore, Johari said 2016's fiscal deficit of 3.1% for 2016 will remain the same, as all expenditure fell within the Contingency Spending threshold of RM3.5 billion under Budget 2016.

"Every year, when we present our budget, there will be a Contingency Spending budget of RM1.5 billion for OE, and RM2 billion for DE, which we do not itemise, so if we were to utilise these fund, under the law, even if it is just RM1, we are obligated to get it through Parliament," he said.

On top of the Supplementary Supply Bill, the government is also seeking Parliamentary approval of an additional allocation of RM987.76 million for 2016 DE.

For DE, Johari, when contacted by theedgemarkets.com, said the government's actual spending was about RM41 billion in 2016, as compared to the budgeted RM52 billion.

"Minus the RM2.25 billion we transferred from OE, we borrowed about RM38 billion to RM39 billion for DE, but why do we have to ask for another RM987.76 million from Parliament [which is part of actual DE spent]? Same reason as the OE, because these are expenditure we did not itemise during presentation. So now that we have spent it, we have to disclose it," he said, adding that the amount remains under the RM2 billion Contingency Spending threshold.

 

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