Surplus budget with the aim of raising reserves
Published on: Saturday, November 28, 2015
Kota Kinabalu: The public and investors have generally welcomed the fact that the State is projecting a surplus budget next year as it indicates that the State Government has a good expenditure plan.In his winding up speech at the 2016 State Budget sitting here Thursday, Chief Minister-cum-Finance Minister Datuk Seri Musa Aman said despite the small surplus in next year's budget, it is still better than many other states who are projecting deficits in their respective budget plans."During my early years as Finance Minister, I loved to table budgets with deficit, on purpose, but at the end of the year, we always had a surplus. I liked to do it because I liked to surprise the people and the House.
ADVERTISEMENT
"However, we cannot afford to do it now because of the challenging economic situation we find ourselves in. Furthermore, if we proposed a deficit budget, we might lose the confidence of the people and the trust of our investors."So far, the response is good which means they are confident that we have a good budget," he said.Musa explained that it goes without saying that the Government is disappointed by the plummeting price of crude oil in the world market, which severely affected Sabah's revenue.
ADVERTISEMENT
For a long time, as a Chief Minister, he had been waiting and hoping that Sabah's oil production would increase and exceed 100,000 barrels per day because even during that time, Sabah received almost a billion ringgit in cash payment."In the end, it increased and now production is almost 280,000 barrels per day. Unfortunately, the price of crude oil plunged from USD110 per barrel to USD40 per barrel. What can we do? It is not our fault," he said.
ADVERTISEMENT
On Friday last week, during the tabling of the 2016 State Budget, Musa proposed to spend RM3.49b with estimated revenue projected at RM3.52b, hence a surplus of some RM29.9m. The Government is projecting to receive only RM900m in petroleum cash payment next year."The intention behind the surplus budget is to support the effort to increase our State reserves in order to ensure the sustainability of the State's wellbeing. We hope that, even though the value of next year's surplus is small, our overall reserves will continue to grow."I am pleased to announce that at the moment, we have RM3b in reserves to ensure the development of socio-economy in the State can continue in the future," he said.Nevertheless, he said, the government will spend the money prudently and according to its needs and capabilities while at the same time, ensure that none is wasted.He reminded the House that the budget is just a forecast and whatever planned depends on several assumptions."No one can accurately predict such things as the amount of State revenue because there are factors outside the control of the State Government. Rest assured that the Government is aware and knows when we have to spend and when we need to save without compromising the welfare of the people and the momentum of the State's development."To a question by Tamparuli Assemblyman Datuk Seri Wilfred Mojilip Bumburing on Felda and claims that the company had opened 50,000 hectares more than had been gazetted to them, Musa said he would need to verify the charge especially because as a public listed company, Felda needs to adhere to certain rules."I think it is worth looking into and I will ask our representative in Felda to validate the claim. Nevertheless, I myself will also meet with Felda's Chairman," he said. Earlier, Musa reported that M3nery, a full subsidiary of Sabah Development Bank Berhad, is currently carrying out its contract with Petronas Carigali Ketapang II Ltd in Bukit Tua, Indonesia. The project has a capacity of producing 25,000 barrels of crude oil per day with a targeted income of USD76.8m annually. He emphasised that the State Government will continue to work to ensure that each of its investment will give positive return and bring benefit to the State's development."I am glad to report that M3nergy project in Bukit Tua had started producing its first crude oil on May 28 this year. In its first nine months this year, M3nergy had recorded a profit of RM109m. Other than Bukit Tua, M3nergy is also involved in other investment projects," he said.Musa also took the opportunity to express his view on the action of some parties who are seen to be in collusion with militant groups, extremists, even the State's sworn enemies, bent on seizing the rights of the people and the sovereignty of the State through violent and vicious means."We condemn those who treat the security and sovereignty of the country lightly, especially those who ridicule the sovereignty of our beloved Sabah," he said.Stay up-to-date by following Daily Express’s Telegram channel.
Daily Express Malaysia
