Elections not a factor for Budget, says ministry

The coming general election did not figure in the discussions involved in drafting the 2013 Budget, Finance Ministry secretary-general Mohd Irwan Siregar Abdullah said today.

Speaking at a forum in Kuala Lumpur, Irwan (right) said the cash handouts were included because of concern over the rising cost of living faced by the rakyat.

"In the six months that we collected data for the budget, we never had the elections in mind. It was all about the people, the people first," he said.

In particular the second instalment of the 1Malaysia People's Aid (BR1M) was included because “people are having a tough life in big cities” such as Kuala Lumpur. 

“So the RM250 (for unmarried individuals earning less than RM2,000 a month) will lessen their burden a little bit. Whatever people say, election or not, the budget will have to be presented to Parliament," Irwan said. 

He was responding to a question from the floor on whether the budget unveiled last Friday was more about politics than it was about economics.

Speaking to reporters later, Irwan said the government also had the rising cost of living in mind in proposing to foot the delivery costs of consumer products to Sabah and Sarawak. 

However, he said, more could be done when subsidies were rationalised, as the savings could be used for targeted assistance to the poor. 

'Overly-generous budget'

Responding to the same issue at the forum organised by Universiti Malaya’s Faculty of Economics and Administration and the Malaysian Economics Association, tax consultant Veerinderjeet Singh said the budget was indeed a political one. 

"It is quite weird to observers. It is very political, rather than focusing on the economy. Some things could have been held back, like the one percent income tax cut, until a more holistic review is done," Veerinderjeet said. 

Calling for greater cuts in ministry expenditures, the panellist said the budget was "overly generous". 

Fellow panellist and Malaysian International Chamber of Commerce and Industry executive director Stewart Forbes said while the budget ignored fundamental issues, this was to be expected in the run-up to the general election. 

"But Friday's budget did not harm investor confidence as it came in a political environment and will  be accepted as such. 

"The next 12 months will see an election and then a new budget will be produced and if that budget does not address a series fundamental structural areas, there will be serious impact on investor confidence," Forbes said. 

Forbes was nonetheless "caught by surprise" by the "degree of outspoken appeal to voters and attack on the opposition" by Prime Minister Najib Abdul Razak in his budget speech. 

"When you hear, in any context, a very specific attack on contrary opinion, a view is that this guy does not believe in what he is saying that he feels it necessary to attack the opposition," he said. 

"The budget can stand by itself, it has great value and did not need the negative part on top."