GEORGE TOWN, May 24 — The Penang government must implement a deficit reduction strategy for 2024 as it cannot always rely on the accumulated balance of the state’s consolidated fund, said Yang diPertua Negri Tun Ahmad Fuzi Abdul Razak.

The governor said the state administration must take proactive steps if there is no significant increase in state revenue within a deficit budget.

“In this regard, during this meeting, I would like to call on all the state assemblymen present to come up with suggestions on how the state can increase its revenue,” he said in his speech at the opening of the second term of the 15th state legislative assembly today.

He said the state’s fiscal performance would only improve in the near term if there were collective determination and commitment from all parties.

He said generally, Penang has consistently demonstrated good financial performance compared to other states in Malaysia.

“This is because the state's deficit budget is still able to be covered by the accumulated balance of the state consolidated fund, thus recording a positive financial performance at the end of the year,” he said.

He added that Penang is also the second state with the lowest accumulated amount of outstanding federal government loans, which amounted to RM36.73 million as of January 31.

Even though the state has never neglected to ensure fiscal sustainability in the long term, he reminded the state that it cannot always rely on its state consolidated funds to cover the state’s budget deficit.

Last November, Penang Chief Minister Chow Kon Yeow tabled a RM1.047 billion budget with a projected deficit of RM514.53 million.

The 2024 budget is RM58.13 million higher than 2023's budget of RM989.47 million.

The state has tabled an increasingly higher budget over the past few years from RM792.66 million in 2020, with a deficit of RM273.5 million, a RM909.82 million budget in 2021 with a deficit of RM403.8 million, a RM935.22 million budget with a deficit of RM449.8 million in 2022 and a RM989.47 million budget with a deficit of RM467.12 million in 2023.

The 2024 Budget was also the 13th consecutive deficit budget Penang had tabled since 2011.

https://www.malaymail.com/news/malaysia/2024/05/24/penang-governor-tells-state-to-find-ways-to-offset-overspending/136208