YB Wong Chen's LIVE Commentary of the Tabling of Budget 2023
[08:29 AM] Good morning.
No dissolution of Parliament yesterday after the PM met the Yang di-Pertuan Agong.
This means Budget 2023 should be tabled later today after Friday prayers. However, since UMNO has declared that it wants GE15 to be held this year, immediate dissolution is on the cards after today's tabling. Unless of course UMNO is having a hidden major internal crisis where the pm is simply ignoring instructions of his party.
This is a sad and ridiculous state of affairs. While the nation is facing global recession and inflation, and impending floods around the corner, UMNO is consumed and preoccupied with political schemes. The very real concerns of the rakyat is not a factor in these schemes.
In addition, this hapless coalition government is already openly at war with each other. In Parliament, when ministers reply, you are left wondering whether the policy reply is official or not, simply because the parties in government are no longer united.
Bersatu's Tan Sri Muhyiddin, is conducting an open war with UMNO, but his Bersatu ministers have not resigned and continue to enjoy ministerial perks. Does Muhyiddin even control his ministers?
The same question is being asked about UMNO, does Zahid even control the pm and UMNO ministers? Adding more confusion to the imploding government, PAS is now courting their traditional arch enemy UMNO and looks like it will abandon the PN coalition, led by Bersatu. But Bersatu insists they are not being ditched by PAS.
Political plotting is not my forte. I don't think there is a more politically confused government in the world today. So instead of trying to understand the dark political hearts and intentions of politicians, I will be focusing the next few days on the budget.
I will be busy the next few days deciphering, analysing and commenting on the budget. I have declined and cancelled all community events this weekend and Monday. I will also be helping the office of the Leader of the Opposition on the budget reply speech, to be delivered next Tuesday.
[03:48 PM] I am in the hall now. 10 minutes to go. There is a massive media presence.
The budget documents are on our table. We are not allowed to read it until 4 pm. I will be posting my initial comments soon.
[04:05 PM] It is past 4 pm, the budget embargo has been lifted.
Here is my very first reactions: this is a massive election budget of RM369 billion! The biggest ever in Malaysian history but it is funded by the biggest ever development debt of RM97 billion!
Overall deficit is 5.5% of GDP.
Revenue: Government project revenue collection at RM273 billion. Compared to this year (2022) the revised revenue projection is now at RM285 billion. So a projected drop in revenue collection.
Operating Expenditure: The government is reducing operating expenditure for 2023 by some RM12 billion compared to 2022.
This has gone through the roof! The government intends to borrow RM97 billion to pay for this highest ever development spending budget of RM97 billion. There is also a provision of RM5 billion for Covid-19.
[04:18 PM] What is my initial political reaction? With lower operating expenditure by some RM12 billion, are subsidies being actively cut for 2023? We need clarification from the government.
On the other hand, tycoons and contractors of the government are probably giving high fives and popping champagne. A whopping RM97 billion of government projects are coming in the pipeline next year! While they celebrate, our unsustainable national debt will increase by another RM97 billion next year.
Note that in a typical year, development spending budget should be in the range of RM50 to RM60 billion. Therefore this is obviously a case of election fever spending! I am sure many of these grateful tycoons and contractors will be opening their checkbooks to make political donations soon for GE15.
[05:07 PM] We all know that development spending will benefit tycoons and contractors who are linked to those in power. However, I have to concede that in basic economic theory, these spending will also trickle down to help workers employed by these projects.
The big question is how much of these RM97 billion of government projects for 2023 will trickle down to the normal people via work and wages.
I looked everywhere for 30 minutes and found the answer in a chart.
The official answer is NOTHING! The government own economic key data and forecast shows that income per capita will reduce by 1.2% from RM50,314 for 2022 to RM49,717 for 2023.
So after pumping almost RM100 billion in projects, the government forecasts that the ordinary Malaysian will be 1.2% poorer in 2023!
Is this then not a budget that favours the elite and rich, written by a rich elite?
[05:24 PM] The minister of finance has been reading out a long list of goodies and social support for the last hour or so. The government is trying to create a perception that it cares for the people and will be providing a lot of aid, next year. This perception is NOT true!
On page 114 of the 2023 Fiscal Outlook Book, this government intends to cut subsidies and social assistance next year to RM42 billion from RM58.9 billion this year. This is a reduction of RM16.9 billion or a big reduction of 29%.
Cakap tak serupa bikin!
[05:46 PM] How much will Petronas cough up for 2023? Answer: RM35 billiion!
The government has constantly said that Malaysia has to wean off revenue dependency on oil and gas. Squeezing RM35 billion from Petronas is not an act of fiscal discipline but the very opposite. The normal contribution of Petronas to government revenue is about RM25 billion a year.
See page 223 of the Fiscal Outlook book.
However the truly shocking data from that page is the disclosure that the MoF for this year (2022) raided RM50 billion from Petronas. This increase was not approved by Parliament.
The hypocrisy for all to see is the fact that the MoF is now championing a Fiscal Responsibility Act.
[06:11 PM] Joke of the day. MoF in his speech says the government is committed to the green economy and all good things for the environment. He goes on to say that this commitment is reflected in the national target to reach net zero "se-awal-awalnya 2050".
This is NOT a commitment to reach net zero before 2050, but a statement that the government does not have a time commitment to reach net zero, and that the government intends only to reach net zero at the very earliest in the year 2050.
[06:12 PM] As Tengku Zafrul ends his two hour speech, many MPs called out "bubar".
So ends the budget for the rich!