PETALING JAYA: Malaysia has proven to the world that it can steer its economy in various circumstances, says Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

Tabling the Perikatan Nasional government’s first national spending plan, Tengku Zafrul laid out in the Dewan Rakyat a budget with a RM322.5bil expenditure, the biggest in the country’s history.

“One irrefutable fact that is worth reminding everyone about is that irrespective of the challenges, we have proven to the world that Malaysia can steer our own economy – whether in stormy seas or calm waters, ” Tengku Zafrul said.

With its theme “Resilient As One, Together We Triumph”, Budget 2021 aims to help Malaysians weather the Covid-19 pandemic, keep businesses going and promote economic recovery.

Budget 2021 contains a slew of measures to help almost every level of society.

They include more payments to B40 households, a cut in individual income tax and targeted Employees Provident Fund (EPF) withdrawals to help those who have lost their jobs, among many others.

“Besides a more targeted approach, the government will strike a balance between financial sustainability and reducing the urban and rural development gap, ” he said.

Of the RM322.5bil total expenditure in Budget 2021, RM236.5bil will be for operating expenses, RM69bil for development expenditure and RM17bil under the Covid-19 Fund.

For the first time, budget consultations were held in all states in the country and involved more than 38 dialogues covering over 40 businesses and industries.

“Most importantly, the ministry engaged with Malaysians across the full spectrum, from youth, women and parents to senior citizens, ” said Tengku Zafrul.

A number of measures have been outlined to help win the war against Covid-19 and protect public health.

They include an additional RM1bil allocation to fight the current third wave of the contagion in Malaysia.

A RM3bil ringgit allocation will also be set aside to buy Covid-19 vaccines when they become available.

The social safety net for the vulnerable in society will also be strengthened.

Tengku Zafrul said more than 400,000 households earning less than the poverty line of RM2,208 will get help under a RM2.2bil allocation.

The Bantuan Sara Hidup (BSH) aid will be replaced with an improved Bantuan Prihatin Rakyat (BPR) scheme, which will benefit 8.1 million recipients compared to 4.3 million recipients under the BSH scheme.

The allocation for BPR will be RM6.5bil compared to RM5bil for BSH.

Measures have also been included to help reduce the people’s burden such as a one per cent reduction in individual income tax for those with a taxable income band of between RM50,001 and RM70,000.

The move will benefit 1.4 million taxpayers.

Tengku Zafrul said the EPF would introduce a facility to allow contributors to withdraw from Account 1 on a targeted basis of RM500 a month with up to a total of RM6,000 over 12 months.

“This withdrawal will assist members who have lost their jobs and is expected to lighten the financial burden of about 600,000 affected contributors, ” he noted.

With unemployment at 5.3% or 820,000 people jobless in May – the highest since 1989 – job creation and preservation is another key focus in the Budget.

Among the initiatives to create jobs will be Skim Jaminan Penjanaan Pekerjaan (JanaKerja), which will be introduced next year.

The scheme will create 500,000 job opportunities, including skills development and retraining programmes worth RM3.7bil.

Tengku Zafrul said government revenues are set to fall by nearly RM18bil to RM227.3bil, compared to RM244.5bil that was estimated earlier, due to the impact of Covid-19.

“Despite the lower revenue scenario, the government will not compromise in protecting lives and livelihoods in battling Covid-19, ” he said.

Calling for unity in weathering the storm, Tengku Zafrul said while all parties could argue and disagree on minor issues, they should unite to agree on principles.

“I have a belief that Malaysia is a brave and strong nation and when we can agree with each other, we can do extraordinary things, ” he said.

https://www.thestar.com.my/news/nation/2020/11/07/biggest-expenditure-in-malaysian-history