Justice For All Malaysia

Bajet Abdullah atau Bajet Najib?

Posted on: November 5, 2008

Budget protest: House suspended for 2 hours
Syed Jamal Zahiid | Nov 5, 08 1:40pm
The Dewan Rakyat proceedings was suspended for two hours following protests from the opposition bench over the additional figures tabled by Finance Minister Najib Abdul Razak to Budget 2009.

MCPX

wan junaidiDeputy speaker Wan Junaidi Tuanku Jaafar suspended proceedings until 2.30pm after the opposition refused to allow the Bill to reach the committee stage.

Several Pakatan Rakyat MPs led by Opposition Leader Anwar Ibrahim (PKR-Permatang Pauh) had earlier told Wan Junaidi that under Section 66 (15) of the Standing Orders, the House must be informed two days before the tabling of any amendments made to a Supply Bill.

The motion must also be distributed to all MPs, they added.

parliament opposition mps dispute najib budget 051108 01Speaking at a press conference later, the opposition leader and DAP stalwart Lim Kit Siang (DAP-Ipoh Timur) commended the decision by Wan Junaidi to adjourn the proceedings.

“It is a commendable and wise decision by the speaker to adjourn proceedings as there are many issues that require solving before it can be debated at the committee stage,” said Anwar.

Yesterday, Pakatan MPs staged a walkout when Najib refused to allow the opposition to seek clarification over the RM7 billion stimulus package mentioned in his Budget 2009 ministerial winding up speech.

The MPs also saw red when Speaker Pandikar Amin Mulia backed the minister on this matter.

The absence of Pakatan MPs saw the Budget 2009 Supply Bill passed by the Dewan Rakyat unopposed.Which bill was passed?

Commenting on this, Anwar asked: “But which bill was passed yesterday? Is it the budget presented by Prime Minister Abdullah Ahmad Badawi or the budget with additional figures read out by Najib?”

Both Anwar and Lim reiterated that making fiscal amendments to the original budget presented by Abdullah was tantamount to a new budget and members of the Dewan must first be informed of the amendments before it is tabled for reading.

“When we talk about the national budget, every sen must be discussed and get the approval of the Dewan before it can be passed,” said Lim.

parliament stimulas package najib 041108 02Anwar described what happened yesterday as a ‘dangerous sign’ for the country as Najib, who will be taking over the premiership next March, had shown signs of being ‘incompetent’.

“What he did, by clearly violating the rules of parliament, is a very dangerous sign for the country. This is a clear indication of the sheer incompetence of our deputy prime minister,” he said.

Meanwhile, Kamarudin Jaffar (PAS-Tumpat) who was also present at the press conference described what Najib had done as a ‘bad omen’ for the country’s future.

“He has already acted as a prime minister when he is only the deputy prime minister,” he said.

Missing numbers in ‘stimulus package’ puzzling
Dzulkifly Ahmad | Nov 5, 08 3:20pm

MCPX
Analysis In what was Deputy Prime Minister Najib Abdul Razak’s maiden speech as a Finance Minister, he has cast more doubts about his alleged or perceived ‘financial prowess’ of being better than prime minister when it comes to managing the economy.

Hopes quickly evaporated midway through his delivery of his ‘stimulus package’ to bolster the economy. It has nothing to do with his refusal to allow the Opposition Leader and MPs to interject during his delivery – an unprecedented move strangely condoned by the Speaker.

Firstly, quite unsolicited, he decided to take a pot-shot at the Pakatan Rakyat’s budget – perhaps more accurately the Opposition Leader Anwar Ibrahim – by accusing that the Pakatan budget was “contractionary” as opposed to their “expansionary” one.

parliament stimulas package najib 041108 pc 02He cunningly reminded everyone, that the nation will be in greater trouble – like during the 97-98 financial crisis – if we were to pursue Pakatan’s budget.

Najib is either clearly ignorant, which of course spells doom for this nation’s future or simply misleading the House, which is worse, as his limited credibility will be further dented.

A budget is either ‘expansionary’ if there is a deficit or ‘contractionary’ if there is a surplus.

While the BN’s 2009 budget poses a projected deficit of RM28.45 billions, the Pakatan’s budget deficit stands at RM22.10 billions.

Both are deficit budgets, ergo expansionary budgets, period. A lesson in Economics 101 for our new finance minister.

The Pakatan package

On Oct 23 Pakatan presented a budget strategy in response to addressing financial uncertainties and restoring confidence in our economy.

While clearly expansionary and anti-cyclical – in order to weather the ‘slowing down of growth with concurrent inflationary pressure on goods and services with the consequent massive unemployment’ (ie stagflation) – our budget addresses where and how the deficit is to be funded and sustained.

Going by the current global prices of crude oil (CO) and crude palm oil (CPO), even a conservative estimate will show the present BN budget’s revenue projection having a RM18 billion shortfall.

CIMB’s Research House estimated that for every US$10/barrel reduction in price (Tapis crude oil), we’ll lose RM4 billion a year. For every RM100/tonne of CPO, we will be robbed of RM1.7 billion.

An estimated loss or reduction of revenue to the tune of RM18-25billions is to be anticipated.

Our approach was not just expansionary, it was prudent so that we maximise the ‘multiplier effects’ in critical sectors critical sectors of quality housing, healthcare and education.

A ‘quality deficit’ was intended, not speculative endeavours like injecting RM5 billion from Employees’ Provident Fund (EPF) to shore up ‘undervalued companies’ or delving into mega-projects – like underground cables, double-tracking railways or dubious military helicopter procurement.

Najib was glad to announce the RM7 billion saved from reduced fuel subsidies, yet side-stepping the spending spree with his ‘expansionary stimulus’.

Opposed to our projections or even CIMB’s, Najib stated that the revenue drop would be only RM176.22 billion to RM168.73 billion – which is only a RM8 billion revenue loss.

Presumably the revenue reduction takes into account CO and CPO. Which does not add up.

Missing RM7 billion

Even with our conservative RM18 billion deduced by the RM7 billion saved in fuel subsidy reduction, a yawning RM11 billion is the revenue deficit.

He did not admit this out-right, but there was an indirect concession when he stated they were expecting a bigger deficit of 4.8 percent.

But behold, the finance minister foolhardily informs of another RM7 billion, which he claims is from the fuel subsidy. Mind-blowing.

The numbers do not jive, whichever way you look at them. This additional RM7 billion must either be from borrowing, leveraging or gearing – all dirty words from the US financial crisis.

It would have been better for Najib to admit that the money is to be borrowed from a source like EPF or that the government is raising bonds.

Yes, we may have a healthy national reserve of 37 percent of our GDP.

Yes, we may have low non-performing loans for the time being.

Yes, we may have a low foreign debt currently at RM187 billion with RM70 billion private debt. As of April 2008, this maybe 20 percent of the foreign reserve.

Pakatan may have to grudgingly admit that our national fundamentals are strong, even if they are not naturally trickling down to the rakyat – thanks to inflation and poor distributive justice.

But bear in mind that we have had 10 years of deficit budgets.

Irrespective of whose fiscal stimulus package is put it as a anti-cyclical measure – be it BN or Pakatan’s – it has to be prudent and carried out productively.

Our bullishness may now be totally misplaced as party time has long expired for our finance minister.

The Eurocopters deal and a slew of mega-projects should have been voluntarily withdrawn a long time ago.

I doubt if you have any hindsight. Your recurring blindspot is extremely distressing and very worrying to say the least.

DR DZULKIFLY AHMAD is director PAS Research Centre and member of parliament for Kuala Selangor.

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