Budget 2022 – Opposition MPs warn of big crunch ahead

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Opposition MPs were not impressed with Budget 2022, with many saying it does not address a future economic crunch, lacks focus and does not promote the Malaysian Family concept.

They also questioned where the government was going to raise the funds to pay for the biggest Malaysian budget ever – totalling RM332.1 billion.

DAP’s Tony Pua said the government revenue in the budget’s fiscal outlook shows the medium-term framework for 2022 to 2024 will only be 13.9% of the gross domestic product (GDP).

He said this was a drop from the expected 14.3% in 2022, leading to a longer-term decline from the 15.9% in 2020.

“In simple terms, in future, the government will have less funds to spend, invest and influence the economic direction of the country.”

Bernama

The DAP national publicity secretary said the budget failed to address measures and strategies to prevent an impending budget crisis that could hit Putrajaya in the next three to five years.

“It’s a double whammy on discretionary spending with increases in fixed payments and charges,” he said in a statement.

Fixed payments, he said, refer to expenditures, including emoluments, retirement charges, pensions, debt service charges, grants, and transfers to state governments.

For example, he said, emoluments and retirement charges formed 45.5% of operating expenditure in 2018 but will increase to 49% in 2022.

“Even more alarming is the massive rise of debt service charges from 13.2% in 2018 to 18.5% in 2022,” Pua said.

This would see the allocation for supplies and services, subsidies, and social assistance reduced, he said.

Subang MP Wong Chen questioned how the government was going to pay for the huge budget.

“With this budget, the national debt will cross RM1 trillion next year. For next year alone, debt servicing costs will hit RM43 billion,” he said.

In comparison, he said the interest payments alone would be bigger than the entire health budget of RM32 billion for next year.

“It is also an election budget as the government announced a higher development expenditure budget of RM75.6 billion.

“We had expected a recovery budget that focuses on operating expenditure but not this big.

Klang MP Charles Santiago, meanwhile, said the budget fails to help businesses to come out of the economic crisis.

“It lacks focus on rebuilding the economy, especially in digitalisation and the use of solar energy, which can have a multiplier effect on the economy,” said Santiago.

PKR deputy information chief G Manivannan also described it as a “rhetoric election budget” with little details.

“How will the budget improve the economy or is it to assist certain people win elections that are expected next year?” asked the former Kapar MP.

Manivannan also said that, despite Prime Minister Ismail Sabri Yaakob’s much-touted concept of Malaysian Family, the budget did not reflect it.

He cited the RM100 million allocation for the aerospace industry as an example.

“It is limited only to Bumiputera applicants. Why do they have to do this? The Indians and Chinese youths also want to join the industry,” he added. – FMT