2019 Malaysia BUDGET SPEECH BY YB TUAN LIM GUAN ENG MINISTER OF FINANCE (Part 5)

Link to download the entire speech : http://www.treasury.gov.my/index.php/en/budget/item/4526-annual-budget-2019.html

1. The private sector can provide expertise, service quality
   and delivery, while the Government can make available public
   sector capacity, resources and infrastructure to the private sector.
   As an example, public TVET training institutes can be operated
   by the private sector to ensure the relevance and quality of
   courses conducted. The Government can also offer its existing
   under-utilised infrastructure as shared facilities for them. The
   concept of private sector operating public infrastructure can be
   done for Pusat Sains Negara and Planetarium as a means to
   reduce Government expenditure.

Strategy 12: Ensuring Equitable and Sustainable Economic Growth

Mr Speaker Sir,

1. Malaysia can certainly emerge a developed high-income
   nation by ensuring that economic growth is equitable, inclusive
   and sustainable for all regardless of race and religion.
   Ensuring Balanced Development

Mr Speaker Sir,

1. As a responsible Government, due emphasis will be
   given to ensure balanced development throughout the country,
   especially in the rural areas. Therefore, the Government will
   continue to improve and upgrade basic infrastructure especially
   in rural areas with the following initiatives.

2. FIRST: To build and upgrade roads, rural roads, and
   bridges with an allocation of RM926 million.

3. SECOND: To broaden the electricity and water supply
   to rural areas with an allocation of RM694 million and
   RM738 million respectively.

4. THIRD: An allocation of RM85 million to New Villages
   towards upgrading and maintaining basic infrastructure such
   as roads, community halls and open spaces.

5. FOURTH: An allocation of RM100 million to support
   the Indian community, including TVET to improve the career
   advancement opportunities of the Indian youths.

6. FIFTH: An allocation of RM100 million to strengthen the
   development of orang asli communities through the construction
   and upgrading of infrastructure for the supply of water, relocation,
   education, welfare and economic development.

7. SIXTH: An allocation of RM20 million to residents’
   associations registered with the Registrar of Societies to
   carry out community, security, cleaning and community
   activities.

8. SEVENTH: For FELDA settlements, the Goverment will
   allocate RM100 million to upgrade roads, RM160 million to
   carry out water supply projects and RM35 million for building
   construction and upgrading works, as well as installation of street
   lights. This represents an overall increase of 51% compared to
   the previous year’s allocation.

9. The Government will ensure continued development
   of Sabah and Sarawak. The Government has allocated
   RM5,009 million has been allocated to Sabah as compared to
   RM4,133 million in 2018. As for Sarawak, RM4,346 million has
   been allocated compared to RM4,336 million in 2018.

10. The Government will continue to implement the Pan
    Borneo Highway Project encompassing Sabah and Sarawak,
    subject to a cost rationalisation exercise. In addition, projects in
    Sabah and Sarawak will include the construction and upgrading
    of water supply, electricity supply, and infrastructure, health and
    education facilities as well as the development of the respective
    economic corridors.

Women in the Workforce

Mr Speaker Sir,

1. The participation rate of Malaysian women in the labour
   force is only 53.5% in 2017 compared to 77.7% for men. Of the
   number who are not working, 60% or 2.6 million women cited
   the burden of housework as the primary reason they are not
   part of the labour force.

2. According to a report recently published by Khazanah
   Research Institute, raising women’s employment level by 30% would
   raise Malaysia’s GDP between 7 to 12%. Hence, the Government
   will formulate policies to encourage women to participate in the
   workforce:

3. FIRST: An allocation of RM10 million will be provided to
   set up additional 50 childcare facilities in Government buildings
   to ease the burden of working mothers. The Government will
   continue to encourage and incentivise the private sector towards
   providing equal employment opportunities for women.

4. SECOND: The Government is committed towards increasing
   the participation of women in line with the 30% target at leadership
   and decision-making levels in companies and organisations. The
   Government has created history by electing the very first female
   Deputy Prime Minister in Malaysia, as well as female Ministers.
   Currently, 36% of the senior officers in the public sector are women.

5. THIRD: The Government will encourage higher women
   participation among the public listed companies as only 23.2% of
   the appointed Board of Directors are women today among the top
   100 largest companies on Bursa Malaysia. We call upon the private
   sector to emulate the Government by ensuring the objective of 30%
   women participation in the Board of Directors is achieved by 2020.

Environment and Energy for the Future

Mr Speaker Sir,

1. The Government is committed to take all necessary
   measures to protect our environment, both as a responsibility
   and an endowment to our future generations. Seeing that the
   forest and marine reserves are under the purview of State
   Governments, the Federal Government will allocate RM60 million
   to State Governments marking efforts to protect and expand
   existing natural forest reserves and protected areas.

2. The Government will take steps to list the Forest Research
   Institute Malaysia (FRIM) Forest Park in Selangor, and Royal
   Belum Perak as UNESCO World Heritage Sites.

3. The Government will allocate RM5 million for micro-grants
   to implement community-led programmes in collaboration with
   the United Nations Development Program (UNDP), to manage
   and protect the environment towards fostering the economic
   development of Orang Asli and Orang Asal communities.

4. To attract environmentally-friendly investments and to
   reduce the pollution of plastic waste, the Government proposes
   to provide Pioneer Status incentive of 70% or investment tax
   allowance of 60% for 5 years to companies which produces
   environmentally-friendly plastics based on bio-resin and biopolymer
   materials.

5. To incentivise investments in green technology, a
   RM2 billion Green Technology Financing Scheme (GTFS) will be
   made available where the Government will subsidise the interest
   cost by 2% for the first 5 years.

6. Bank Pembangunan Malaysia Berhad will also provide
   a Sustainable Development Financing Fund of RM1 billion to
   support Agenda 2030 for Sustainable Development as well as
   the 17 Sustainable Development Goals (SDG) under the United
   Nations Development Programme. To this end, The Government
   will provide an interest subsidy of 2% as an incentive.

7. Additionally, to promote the use of green technology, the
   Government will expand the list of green assets which qualifies
   for the Green Technology Investment Allowance (GITA) from
   9 assets to 40 assets which will be listed in the MyHijau directory.

CONCLUSION

Mr Speaker Sir,

1. Budget 2019 will allocate a total of RM314.5 billion in
   expenditure as compared to an estimated RM290.4 billion in 2018.
   From the total, RM259.8 billion is for Operating Expenditure while
   RM54.7 billion is provided for Development Expenditure. This does
   not take into consideration the Contingency Fund of RM2 billion.

2. For Development Expenditure, the Economic Sector received
   the highest allocation of RM29.2 billion encompassing transport,
   trade, industry, energy and public utilities and agriculture. The
   Social Sector will receive RM15.2 billion. The Security Sector will
   receive an allocation of RM7.1 billion, and General Administration,
   RM3.2 billion.

3. The Development Expenditure has increased from
   RM44.9 billion in 2017 to a projected RM54.9 billion and
   RM54.7 billion in 2018 and 2019 respectively. The key reason
   is due to a reclassification of what was previously classified as
   Operating Expenditure to Development Expenditure amounting to
   RM6.9 billion and RM9.7 billion in 2018 and 2019 respectively.

4. Examples of reclassified items are payments to Prasarana
   for LRT construction and to Suria Strategic Energy Resources for
   the gas pipeline projects. Previously, the expenditures were treated
   as transfers under Operating Expenditure when they were actually
   Development Expenditures in nature. Other similar expenditures
   were lease or maintenance payments for the construction of
   PDRM buildings and refurbishment of schools.

5. To ensure that the Government is able to meet the objectives
   expressed in the Mid-Term Review by the Prime Minister as well
   as this Budget, we will need to have an effective and efficient
   public sector. Policymaking and implementation must be efficient
   and effective. It is only then we engender confidence amongst
   investors and the rakyat in our institutions.

6. The Government will increase the practise of Alternative
   Service Delivery to reduce the role of the Government in providing
   non-core services. This will be pioneered in the welfare sector through
   partnerships with NGOs. For example, children from orphanages
   will be transferred to family-based care facilitated by NGOs.

7. The Government is allocating RM286.8 million to the
   Malaysian Anti-Corruption Commission (MACC) for its Operating
   Expenses, an 18.5% increase from RM242.1 million allocated last
   year. The labour resources will be increased by 100 personnel in
   2019 to ensure that the MACC has all the necessary resources
   and manpower to combat corruption in both the private and
   public sector, and follow the money trail to recover stolen funds.

Mr Speaker Sir,

1. The Government records its appreciation to the Malaysian
   Armed Forces, Royal Malaysian Police, Fire Rescue Department
   and Royal Malaysian Customs Department for ensuring the
   security, peace and safety of the country. In appreciation of
   the efforts and dedication of all civil servants, the Government
   would like to announce a bonus of RM500 for grades 54 civil
   servants and below. For government pensioners, a bonus of RM250
   will be paid. These bonus payments will cost the Government
   RM1 billion. Unlike the previous government, who usually made
   bonus payments in the next year, these bonus payments will
   be made by the end of December 2018.

2. The Government wishes to thank the donors who have
   contributed to Tabung Harapan Malaysia which has amounted
   to RM196.5 million this week. The fund represents a symbol
   of loyalty and patriotism of the Malaysian people to assist the
   Federal Government to pay off the country’s debts inherited from
   the previous Government. The Tabung Harapan Amanah Account
   will be closed on 31 December 2018.

3. There is no doubt that the new Malaysia under the
   dynamic and forward-looking leadership of YAB Prime Minister
   (Langkawi) has been the inspiration of the rakyat and the
   world. There is now a renewed confidence in Malaysia that
   we will overcome our economic challenges and shape a new
   future.

4. The confidence in YAB Prime Minister (Langkawi) and
   in Malaysia cannot be better expressed than the offer by the
   Japanese Government to guarantee JPY200 billion of 10-year
   Samurai bonds, or approximately RM7.4 billion, via Japan Bank
   for International Cooperation at an indicative coupon of 0.65%.
   This Samurai Bond is expected to be issued before March 2019.
   The Government wishes to record our sincere appreciation
   to the Japanese Government for guaranteeing the samurai
   bond.

5. Despite facing fiscal challenges, our financial sector
   remains healthy and monetary sector continues to be stable.
   Sustainable economic growth must be maintained to improve
   economic well-being, and the higher revenues generated will
   address our public finances.

6. In conclusion, the historic moment on 9 May 2018 will
   only matter if the government’s fiscal health can be restored
   and the people are better off economically in the form of higher
   wages, better jobs and more money to spend.

7. As long as we are clean, people-centric and focused on
   carrying out institutional reforms, we can restore Malaysia back
   to its fiscal health in three years. Our love for our country should
   unite us in facing our challenges. In the words of YAB Prime
   Minister “Malaysia is akin to an Asian Tiger that has been in a
   state of somnolence and has now woken up, and is roaring again”.

8. Despite our differences, Malaysians are special in that we
   continue to work together and trust each other without taking
   into account the differences in culture, religion or background.
   The choice made by the people has been proven correct yet
   again yesterday after two former Goldman Sachs bankers, Tim
   Leissner and Roger Ng, were arrested and charged by the US
   Justice Department.

9. These are the unscrupulous bankers who engineered the
   US$6.5 billion or RM26 billion 1MDB bonds, by colluding with
   thieves in Malaysia to steal from the people of Malaysia. Better
   news yet, Jho Low, the architect of the fraudulent scams, has
   been indicted in absentia in the United States of America.

10. To the crooks who have stolen our money, you should
    not only return the money back but you must also be prepared
    to face justice. To those who still support these crooks, you
    should apologise and resign from public office.

11. Malaysia is clean and we are proud that Malaysia is
    clean again. For those who have strayed from the path, return
    to the straight path. Amar makruf nahi mungkar (Enjoin what is
    right and forbid what is reprehensible). Let us forge ahead, full
    of hope towards “A Resurgent Malaysia, A Dynamic Economy,
    and A Prosperous Society.”

Mr. Speaker Sir,
I beg to propose