FEDERAL BUDGET 2021 – MALAYSIA BOLEH SPIRIT RECEIVES A BOOST FROM COVID.19

 FEDERAL BUDGET 2021 – MALAYSIA BOLEH SPIRIT RECEIVES A BOOST FROM COVID.19

Like a certain Putrajaya-based engineer, I wish to start by saying I am not a tax accountant or any other kind of accountant, by training and profession. I am just a kedai kopi political commentator and currently, in a state of bewilderment.

As a budget commentator somewhere said of the Malaysia’s federal budget 2021: It is a behemoth deficit budget, the biggest ever in Malaysia’s history. 

I supposed this will receive a notable mention in Malaysia Book Of Records. The deficit we are looking at is RM85.6 billion pok.

Now, this is the most perflexing  part of this budget : Finance Minister Tengku Zafrul said the economy is seen growing at 6.5%-7.5% in 2021, after shrinking 4.5% this year. 

As far as I know, the Malaysian economy, like the rest of the world was and still is in a recession, with China as the sole exception. Still, there could have been some external intervention from ‘over the blue yonder’ which I was unaware of and Malaysia extricated herself out of the recession just before the budget was tabled yesterday. Maybe our Raja Bomoh Sedunia Nujum VIP took out his fish trap and with honey coconut (kelapa madu) enticed all the magical economic rays to converge in Malaysia. 

But seriously, if you are talking about a GDP growth of between 6.5% - 7.5% immediately after a recession, you are talking about a V-shaped recovery. This to my mind is most unlikely as the other figures and data in the budget speak otherwise. Let us take a look at some key numbers and see if they jive with the forecasted GDP growth:

.  Dividend from state oil firm Petronas [PETR.UL] at 18 billion ringgit, down from this year's 34 billion ringgit

.  Total revenue is expected to be severely affected following the decline in business, trade and tourism receipts as the worldwide lockdown actions reduce global trade vibrancy and people's mobility.

.  Current account surplus is seen falling to 20.3 billion in 2021, from this year's 48.5 billion ringgit due to an expansion of domestic industrial and investment activities.

Centre for Market Education Malaysia CEO Carmelo Ferlito said a 7% GDP in 2021 is a dream.

We recall that this budget’s deficit is going to be RM85.6 billion. How will the PN government finance this deficit? A stable government presiding over a thriving economy during normal times will have no problem borrowing money from the international community to finance it. But this government is without mandate from Malaysians and is hanging on to dear life through an intricate game of appeasement of greed crazed members of parliaments. I am beginning to wonder if the RM81.1 million allocation to JASA is part of it’s survival plan. 

At this point I must once again remind readers that I am not a tax accountant who is singularly qualified to comment on budget. Just a kopi tiam political commentator.

At the micro level, I am most disappointed with this PN’s budget. While it is a behemoth, never-before-this-big budget, Sarawak’s share of the development budget increased by a mere RM100 million. Surely that is not the value PM Muhyiddin should place on a state that had used its kingmaker status and helped PN enter from the backway and became government. Sungguh tidak berbaloi lah. Muhyiddin is thumbing his nose up at GPS MPs and ministers and saying ‘ I am Malaya first’ and the GPS boys are not even aware of it.

ADUN Yb Dr. Annuar said Sarawak need at least RM3.2 billion to repair and upgrade close to 800 dilapidated schools. Sarawak got RM725 million, enough for only 50 dilapidated schools. 

Children from B40 families particularly those in rural Sarawak are left far behind in their studies because they do not have the means to attend classes online but there is not even 1 sen allocated to assist them. 

The RM3 billion allocations for the COVID.19 vaccine seems to be based on Malaysia’s population of 32.6 million people and a projected vaccine cost of around USD20 or approx. RM80 per pax. The other assumption seems to be that 1 dose per pax will be enough to insulate all Malaysians against the COVID.19. If 2 doses per pax is required to protect Malaysians then the allocation is woefully insufficient.

I tell you lah, like this cry also no tears one.