Re-Tabling Of National Budget And Necessity For An Economic Debate

The slower Gross Domestic Product (GDP) growth of 4.7% for the first quarter of 2012, as announced recently by Bank Negara Malaysia (BNM), has a serious repercussion on Malaysia’s public finances. It is the second time that Dato’ Seri Najib Tun Razak’s administration failed to achieve important economic targets which were the basis for the National Budget of 2012. While the GDP growth of 5.1% for 2011 was at the lower end of the projected range of 5.0%-5.5% used as assumptions by Barisan Nasional in the budget, Dato’ Seri Najub obviously missed the 16.2% growth target for private investment in 2011, which turned out to be only 14.4%.   
 
I have cautioned Dato’ Seri Najib that his tendency to manipulate economic growth projections that enables him to flaunt a much lower but unrealistic deficit-to-GDP ratio target is irresponsible. During the debate on 2012 Budget in Dewan Rakyat on 10 October 2011, I had also argued that the economic assumptions used (i.e. 5.0% – 5.5% and 5.0% – 6.0% growth for 2011 and 2012 respectively) were seriously flawed.
 
It is now clear that the assumptions used to develop the 2012 Budget are off-tangent, not valid and unrealistic from the start. The downgrade on 21 March 2012 by BNM to the official GDP growth guidance for 2012 to a 4.0% – 5.0% range, way below the 5.0%-6.0% range used as assumptions for Budget 2012 vindicated my earlier call to re-table the Budget 2012.
 
I therefore reiterate my call made in the Dewan Rakyat previously that the Budget 2012 should be re-tabled for a debate in the June 2012 session of the Parliament because the growth assumptions were unmistakably wrong. If Barisan Nasional continues to spend in 2012 according to the current budget, this may have a severe impact on the budget deficit, both in terms of amount and share of GDP, which could swell the public debt even further with public debt-to-GDP ratio breaching the 55% statutory limit.
 
Dato’ Seri Najib’s misleading remark that Pakatan Rakyat does not intend to implement economic policies expounded so far also warrants a closer scrutiny. He specifically misled the public when he accused Pakatan Rakyat of promising a RM4,000 minimum wage.
 
Pakatan Rakyat proposes a radical approach to undo the continuing economic decay due to Barisan Nasional’s mismanagement and misappropriation. One of the most radical economic realignments proposed is to shift the policy focus from the much abused 30% equity target for Bumiputra currently pursued by Barisan Nasional; towards an income-based economic target of RM4,000  minimum household income for each family within 5 years of Pakatan’s administration. Apparently, Dato’ Seri Najib has failed to distinguish the difference between a legally instituted minimum wage that employers are required by law to offer to all employees and a minimum household income that Pakatan Rakyat strives to offer to the rakyat within 5 years in power.
 
The 30% Bumiputera equity target has been hijacked by cronies and special interests to enrich themselves at the expense of the general public. The disparity between rich and poor widens significantly as a result of the abuses perpetrated in the name of achieving the 30% equity target.
 
A more equal and yet cost-effective management of the country’s wealth should rightly focus on ensuring every family can prosper economically under the Malaysian sun. Every family’s income must rise in tandem with the rise in cost of living. Every family must earn above poverty level so as to be able to invest in the future of their children.
 
Thus, the economic target set by Pakatan Rakyat that the combined income of each Malaysian family should be at least RM4,000 a month is not only morally right but achievable through a combination of pro-rakyat economic policies proposed.
 
Dato’ Seri Najib should not criticise our economic policies when he keeps avoiding a public debate on such policies. If he is confident that Pakatan Rakyat will not be able to deliver its economic promises, he must be bold enough to defend his conviction in a public debate.
 
His refusal to debate with me on economic policies can only confirm the assertion that he is leading a weak government – economically, morally and intellectually.
 
DATO’ SERI ANWAR IBRAHIM
LEADER OF OPPOSITION
30 MAY 2012

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