Malaysia Is Borrowing To Pay Borrowings

 

And that is why we should instead abolish politicians, because politicians are turning Malaysians into idiots by making them believe you can get everything without having to pay a penny. There is a simple rule in life: there is no such thing as a free lunch.

NO HOLDS BARRED

Raja Petra Kamarudin

The UK’s national debt is RM15 trillion, equivalent to 106% of GDP. Malaysia’s national debt is RM2.5 trillion, equivalent to 54% of GDP.

Half of Malaysia’s borrowings is to service borrowings. That’s like paying your credit card hutang using your credit card. What happens is, your debts increase, and you pay more interest.

This is what the PAC report says (see more below):

PAC took note that RM98.058 billion or 50.4 per cent of the total RM194.555 billion of new government borrowings was used just for the purpose of paying the principal debt for 2020.

PAC also noted that close to a fourth of 2020 gross borrowings meant for the Development Funds Act was used to pay liabilities, operating expenditures, and other guarantees.

Total 2020 gross borrowings for the fund amounted to RM48.571 billion. Only RM37.656 billion, or 77 per cent, was used for development, the A-G revealed.

This makes for an unhealthy situation and prevents development funding from being optimised.

The anti-government activists (or anti-Muhyiddin Yassin activists in Umno) scream and shout about the government not doing enough to help those in financial problems brought on by the Covid-19 pandemic.

The truth is the government is doing as much as it possibly can. But all this ‘free money’ has consequences.

The UK is spending like there is no tomorrow. However, come ‘tomorrow’, the next generation will have to pay for what this generation spends. And taxes will need to go up to recover all the money being spent today.

Malaysia can spend more if that is what the opposition and critics want. Malaysia can even become like the UK. But the UK is going to pay dearly for what it is spending today — or rather the UK citizens will be paying for what the UK is spending today. Income tax, council tax, inheritance tax, VAT, etc., are high. Energy costs and other costs are going up. You need RM7,000-10,000 a month to just stay home and do nothing.

The politicians are telling Malaysians the government is not doing enough and should do more. The politicians are also telling Malaysians that taxes and all sorts of charges should be abolished, and Malaysians should be given everything free. So this is what Malaysians are demanding.

And that is why we should instead abolish politicians, because politicians are turning Malaysians into idiots by making them believe you can get everything without having to pay a penny. There is a simple rule in life: there is no such thing as a free lunch.

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PAC notes A-G’s alarm about growing debt charges, nearly RM100b from total 2020 borrowings

(MMO) – The Public Accounts Committee (PAC) raised the alarm today about the auditor-general’s (A-G) concern over the government’s growing debt charges, totalling some RM100 billion or half of all borrowings made last year.

The statement was issued after a briefing on the 2020 federal statement of account with A-G Datuk Nik Azman Nik Abdul Majid this morning.

PAC chairman Wong Kah Woh said that a certificate that carried the “emphasis of matter” had been issued over various findings, including the worrying level of debt repayment. The A-G had said the debt repayment sum is likely to grow in the coming years.

“PAC took note that RM98.058 billion or 50.4 per cent of the total RM194.555 billion of new government borrowings was used just for the purpose of paying the principal debt for 2020,” the committee said.

“The amount had risen by RM15.335 billion compared to RM82.37 billion in 2019.”

PAC also noted that close to a fourth of 2020 gross borrowings meant for the Development Funds Act was used to pay liabilities, operating expenditures and other guarantees.

Total 2020 gross borrowings for the fund amounted to RM48.571 billion. Only RM37.656 billion, or 77 per cent, was used for development, the A-G revealed.

“This makes for an unhealthy situation and prevents development funding from being optimised,” Wong remarked.

PAC is expected to hold proceedings to scrutinise several issues raised in the briefing soon.

Among them are the findings that up to RM622 million had been poorly managed, leaked or resulted in losses for the public.

From the total, a sum of RM499.18 million of “disorganised” payments were made towards the National Security Council and the Trunk Radio Network Project overseen by the Malaysian Communications and Multimedia Commission.

Earlier today, the A-G’s office issued a statement noting poor financial management on the ruling coalition’s part, citing a case where RM66.87 million in dividends from government investments had been placed in its development fund instead of the consolidated revenue account.

This contravened normal practices and differed to how the 2018 dividends were accounted for, the A-G said.

The Report on the Federal Government’s Financial Statement for 2019 was released in Parliament today.