Najib: Selangor's 'debt' bigger than Pahang's

The "debts" owed by Selangor to the federal government is far bigger than Pahang's debts, said former prime minister Najib Abdul Razak.

This is as Selangor's liabilities to the federal government are at RM25 billion compared to RM3 billion for Pahang, he said in a Facebook post today.

Previously Finance Minister Lim Guan Eng had arrived at Malaysia's RM1 trillion debt level by factoring in both government debts and liabilities. 

Lim had also harped on Pahang's RM3.18 billion debt to question whether the state government can afford to develop the state. 

Najib, in explaining his point about Selangor, attributed the state's liabilities to the RM25 billion channelled by Putrajaya between 2010 and 2018 for Selangor's water assets and water restructuring exercise.

He said Selangor's deal with Putrajaya was for the federal government to buy its water assets, which the state then rents-to-buy.

"Selangor pays back the federal government through mortgages, that is a payment of around RM750 million per year for 45 years before these assets are returned to the state," Najib said.

Comparatively, he said Pahang has actual debt because it borrowed from Putrajaya directly, and remains the owner of its assets.

"Even though both methods involve the federal government allocating funds to the states, (Selangor's) method does not count as official debt because it is classified as a mortgage.

"Nonetheless, both methods require the state government to pay back the federal government," Najib added.

He then railed against Lim for not portraying the real situation when attacking Pahang over its debts. - Mkini