Archive for the ‘Budget 2020’ Category

Catering to all segments of society

Saturday, November 2nd, 2019
Setting up a 5G ecosystem is among the main targets of the 2020 Budget. FILE PIC

THE 2020 Budget has been receiving a myriad of responses over its effectiveness in solving the country’s economic maladies and its ability to stimulate growth.

The nation’s budget is an important instrument and proof of the government’s earnestness in pursuing the economic and social needs and objectives of society and the people. It is reassuring on the whole to see that this budget is a step closer to the Islamic objectives (maqasid) by adopting the concept of ‘shared prosperity’ and showing in many ways that it will be pursued. Yet, there may be scope for better realisation of maqasid of syariah in certain areas.

Beyond technicalities, it is also important to gauge the budget from the lens of Islamic higher objectives (maqasid syariah) as it does not merely function as a legal mechanism, but more importantly, a guide for holistic socio-economic development.

The allocation of RM1.3 billion to the Prime Minister’s Department (Religious Affairs) along with a special grant of about RM100 million for the promotion of Islam as a compassionate and peace-based religion is undeniably a mark of the government’s commitment to protection of religion and development (hifz al-deen).

Although it seems to be allocated for Islamic affairs per se, the Rahmatan lil-Alamin approach adopted by the government would actually enable harmonious interactions between Islam and other religions in Malaysia.

The Malaysian@work initiative, which aims to put Malaysians back to work, is not only commendable because it secures the Islamic objectives of property protection (hifz al-mal), but also because it supports the pivotal Quranic objective of securing human dignity (karamah insaniyyah). It is a timely policy since, last year alone, half a million Malaysians were jobless. For the same purpose, the government will also incentivise youths and firms to bolster the work market in preparation for a more challenging situation next year.

The government also took various steps to address the widening income gap by increasing the minimum wage to RM1,200 in major cities and providing various assistance for the bottom-40, and more importantly the bottom-20 of the economic strata. However, improvement in the amount and coverage of the minimum wage increase is crucial to better address the endemic income disparities in Malaysia.

Closing income gaps may not only lead to better social integration but also fulfils a salient trait of the economic system targeted by the Quran that envisions an equitable distribution of wealth: “So that it will not be a perpetual distribution among the rich from among you.” (al-Hasyr 59:7)

Despite its relevance, return-to-jobs policies need to be approached holistically to observe the unintended consequences on the family institution, a core emphasis in Islamic objectives, as women who have been focusing on their families are now compelled to enter the job market. Sufficient support systems for women workers, such as flexible working hours and childcare facilities at offices, should be enhanced.

The budget also outlines allocations for environmental initiatives which include the extension of the Green Investment Tax Allowance and Green Income Tax Exemption. There are also specific allocations for the preservation of pristine forests, as well as the peninsula’s tiger species.

While these initiatives are in line with the Islamic objective of environmental protection (hifz al-biah), they are also crucial in mitigating the dire consequences of global climate change. Nonetheless, emphasis should also be given to facilitating social-based initiatives, in contrast to a market-based approach, such as local and urban farming as well as environmental activism.

It is also important to highlight the budget’s introduction of a new category of EPF withdrawal for fertility treatment and tax relief of up to RM6,000 for fertility treatment. This is critical in addressing the threatening fall of the country’s fertility rate recorded in 2017 by the Department of Statistics. As Islam emphasises protection of progeny (hifz al-nasl), this initiative is also most welcome as Malaysia is due to become an ageing nation by 2030.

Experts have said that small and medium enterprise (SME) digitalisation is a pleasant surprise in the 2020 Budget. It is an initiative to enhance business efficiency and expand their export markets amid a challenging economic atmosphere considering the ongoing US-China trade war.

Digital transformation is indeed among the main highlights of the budget which includes the setting up of a 5G ecosystem, e-wallet promotions as well as various incentives for fintech firms and technological startups.

While both laudable and necessary, the focus on automation and technological skills among workers and students need to be supplemented by humanities education as this is likely to serve as a cultural and moral compass, helping us to be the best stewards of technology.

Nonetheless, it would be not enough to conclude that the budget fulfils basic aspects of the five essentials, namely religion, life, progeny, intellect and property. Through a more substantial approach of the maqasid, the budget needs to be analysed in light of four underpinning aspects; purposefulness, multidimensionality, interrelatedness and due observance of future consequences.

With the Shared Prosperity Vision 2030 as its core purpose, it is hoped the 2020 Budget will chart a new narrative of sustainable and inclusive socio-economic development that caters to all segments of society.

By AHMAD BADRI ABDULLAH

The writer is a research fellow at the International Institute of Advanced Islamic Studies (IAIS) Malaysia

Read more @ https://www.nst.com.my/opinion/columnists/2019/11/534978/catering-all-segments-society

Budget 2020 proof of govt’s commitment

Tuesday, October 15th, 2019

KOTA KINABALU: Budget 2020 with its many incentives and allocations for Sabah is proof of the government’s commitment to develop the state for the well-being of the people.

Universiti Malaysia Sabah (UMS) head of the Planning and Development Economics Programme, associate professor Dr Janice Nga, said the proposal to double the annual special provision to Sabah and Sarawak under Article 112D of the Federal Constitution from next year was evidence of the Pakatan Harapan (PH) government’s commitment towards the Malaysia Agreement 1963 (MA63).

And, describing the Budget as people-friendly and would bring about prosperity in the long term, Dr Nga said the budget also showed that the Malaysian economy under the present government was growing positively and on the right track.

“The increased allocation for Sabah and Sarawak shows that the country’s economic performance is growing positively as the government is able to increase allocations to both states,” she told Bernama.

Budget 2020 which was tabled by Finance Minister Lim Guan Eng last Friday saw Sabah and Sarawak getting the highest amount of development expenditure at RM5.2 billion and RM4.4 billion, respectively next year.

From 2020 too, the government planned to double the special grants to RM53.4 million for Sabah and RM32 million for Sarawak. It has not been reviewed since 1969.

And, Nga said the move would have huge benefits for the people of Sabah and Sarawak as the allocation would boost development, especially in basic infrastructure and facilities.

Read more @ http://www.newsabahtimes.com.my/nstweb/fullstory/33999

2020 Budget: Incentives aplenty for homebuyers

Saturday, October 12th, 2019
The Housing and Local Government Ministry said that the 2020 Budget has laid out a precise and detailed plan to solve home ownership issues, including the upkeep of housing schemes. – NSTP/SYAMSI SUHAIMI

KUALA LUMPUR: The Housing and Local Government Ministry said that the 2020 Budget has laid out a precise and detailed plan to solve home ownership issues, including the upkeep of housing schemes.

Its minister, Zuraida Kamaruddin, said that under the Rent To Own (RTO) financing scheme, the government will collaborate with financial institutions to assist those unable to afford the initial 10 per cent deposit, or without access to financing, to buy homes.

In addition, RM100 million has been allocated to ensure the maintenance of housing schemes, including lifts, electrical wiring, sewerage pipes and roofing.

“The government has also allocated RM15 million to the City Safe (Bandar Selamat) initiative, in collaboration with local authorities, to provide outdoor lighting, parking with security features for motorcycles, anti-climb fences, and safety advocacy programmes,” she said in a statement, today.

The Housing and Local Governmen minister, Zuraida Kamaruddin, said that under the Rent To Own (RTO) financing scheme, the government will collaborate with financial institutions to assist those unable to afford the initial 10 per cent deposit, or without access to financing, to buy homes. – NSTP/MUHAIZAN YAHYA

Zuraida added that under the Youth Housing Scheme, the government also offers a 10 per cent loan guarantee through Cagamas. This will enable borrowers to obtain full financing and assistance via a monthly installment of RM200 per month for the first two years (limited to 10,000 units of houses from Jan 1, 2020 to Dec 31, 2021)

“I am also happy that the government has approved the Fire Service Allowance for the 14,400 members of the Fire and Rescue Department of Malaysia.

“This will motivate our firefighters to carry out their duties,” she said

By New Straits Times.

Read more @ https://www.nst.com.my/news/nation/2019/10/529178/2020-budget-incentives-aplenty-homebuyers

Dr Mahathir confident Malaysians will receive Budget well

Saturday, October 12th, 2019

KUALA LUMPUR: The Prime Minister is convinced Pakatan Harapan’s Budget 2020 will be well received by the people.

“Looks like many people will be happy.

“Almost everybody gets something, ” Tun Dr Mahathir Mohamad told a press conference after the tabling of the Budget yesterday.

He said despite having a massive debts to repay, the country’s economic performance had improved with growth for 2019 projected at 4.7%, adding that a 4.8% rate was possible next year.

“This means that the (Pakatan) administration is still doing well, although we had to clean up the government.

“Many may feel that the Pakatan government has no experience and may not be able to govern the country well.

“But from what we heard (in the Budget speech), allocations were increased for all and this shows that our financial position is still strong, ” he said.

Dr Mahathir said Finance Minister Lim Guan Eng had prepared a sound Budget that reflected the strength of the present administration and also described the country’s credit rating as being “very good”.

“But of course we have to borrow from the best offer and Samurai bonds will attract an interest rate of 0.5%, ” he said when asked if he was concerned about the credit ratings following higher Budget allocations and the issuance of a second Samurai Bond.

He also said the government will work out the full details on the proposed takeover of the four highway concessionaires.

When asked whether the Cabinet had approved the decision to take over four highways from Gamuda, Dr Mahathir said: “The four highways, we will have to look at the details of them. But the four will be privatised.”

In July, Lim said the government’s proposed RM6.2bil takeover of four highway concessionaires would not see toll charges abolished, only reduced.

Read more @ https://www.thestar.com.my/news/nation/2019/10/12/dr-mahathir-confident-malaysians-will-receive-budget-well#mreILyevQaCb526H.99

Budget 2020: Govt’s initiative to create more jobs for youths welcomed

Saturday, October 12th, 2019

Star

PETALING JAYA: Wage incentives announced in Budget 2020 to encourage hiring of unemployed graduates and local workers have been hailed by Malaysians.

Under the Malaysians@Work initiative, graduates who secure a job after having been unemployed for more than a year will receive RM500 per month from the government for a duration of two years.

Employers will also receive a hiring incentive up to RM300 per month for each new hire over two years.

Malaysian Youth Council president Jufitri Joha welcomed the government’s initiative to create more jobs for youths.

The Malaysia National Federation of Youth Work secretary-general Mohamad Rizan Hassan said the initiative was “new and brave”, considering the economic situation in the country.

However, he asked if it would be applicable only to university graduates or would include those who were technical and vocational graduates.

“What is most important is for youths to maintain and keep their jobs.

“We do not want them to enjoy these incentives but do not keep their jobs once they have obtained these benefits,” he said.

The government will also be offering monthly wage incentives for locals hired to replace foreign workers in abid to reduce the country’s dependency on low-skilled foreign labour.

Under the measure announced in Budget 2020, locals will receive an incentive of RM350 or RM500 depending on sector for two years, and their employers will receive an incentive of RM250 a month during the same time period.

Institute for Democracy and Economic Affairs director of research Laurence Todd opined that the wage incentive to replace foreign workers with locals would likely not be effective.

“I suspect it won’t be too effective in reducing the number of foreign workers, as many foreign workers are employed in jobs which Malaysians are not competing for.

“I do not think this incentive will fundamentally change that, but it might have an impact,” he said.

By Clarissa Chung
Read more @
https://www.thestar.com.my/news/nation/2019/10/11/budget-2020-govt039s-initiative-to-create-more-jobs-for-youths-welcomed#UTs4ygO28ePBpCIK.99

Looks like many Malaysians happy with Budget 2020, says PM

Saturday, October 12th, 2019

KUALA LUMPUR: The Prime Minister believes many Malaysians will be happy with Pakatan Harapan’s Budget 2020.

“Looks like many people will be happy. Almost everybody gets something,” said Tun Dr Mahathir Mohamad at the press conference after the Budget was tabled in Parliament on Friday (Oct 11).

Also present were Deputy Prime Minister Datuk Seri Dr Wan Azizah Wan Ismail, Finance Minister Lim Guan Eng, Defence Minister Mohamad Sabu, Education Minister Dr Maszlee Malik and Health Minister Datuk Seri Dr Dzulkefly Ahmad.

Dr Mahathir said despite having to repay the nation’s debt, the country’s economic performance still managed to improve.

He said economic growth for this year stood at 4.7% and likely would go up to 4.8% next year.

“This means that the (Pakatan) administration is still doing well, although we had to clean up the government. But this doesn’t mean that the administration can’t go on doing well.

“Many may feel that the Pakatan government has no experience and may not be able to govern the country well.

“But from what we heard (Budget speech), allocations were increased to all parties and this shows that our financial position is still strong,” he added.

Dr Mahathir said the country did not have non-performing loans.

He said that the Finance Minister had also prepared a sound Budget that reflected the strength of the nation’s administration.

The Prime Minister also expressed confidence that the country’s credit ratings were “very good” as people had come forward to offer funds for Malaysia to borrow.

“But, of course, we have to borrow from the best offer, and Samurai bonds will attract interest rate of 0.5%,” he said, when asked if Putrajaya was concerned about the credit ratings following higher Budget allocations and the issuance of a second Samurai Bond.

It was reported that the government was expected to issue Samurai bonds early next year, with the issuance size to be determined after discussions with the Japan Bank for International Cooperation (JBIC).

The bond offer is said to come with an even lower interest rate of less than 0.5% compared with the previous rate of 0.63%.

Asked if Panda bonds (renminbi-denominated bonds sold in China) would be issued, Dr Mahathir said “not at the moment”.

The proposed issuance of Panda bonds are meant to assist Malaysia in its financial woes.

However, Lim reportedly said that the bonds were still not attractive enough, price-wise for Malaysia at the moment.

By HEMANANTHANI SIVANANDAMRAHIMY RAHIM and MARTIN CARVALHO & TARRENCE TAN

Read more @ https://www.thestar.com.my/news/nation/2019/10/11/looks-like-many-malaysians-happy-with-budget-2020-says-pm#6MPX4gw2KLxyeVRh.99

Budget 2020: RM500 wage incentive for graduates who secure work

Saturday, October 12th, 2019

PETALING JAYA: Graduates who secure a job after being unemployed for more than a year will receive a wage incentive of RM500 per month under Budget 2020.

Finance Minister Lim Guan Eng said under the Graduates@Work programme, graduates who secure work would receive a wage incentive of RM500 per month for a duration of two years.

“Employers will receive a hiring incentive up to RM300 per month for each new hire for two years,” he said when tabling the Budget 2020 in Parliament on Friday (Oct 11).

Lim noted that there were more than half a million unemployed Malaysians in 2018, of whom 140,000 were unemployed graduates.

Out of those unemployed, Lim said 290,000 were youths including those until 24 years old.

Lim said the programme was designed specifically for the hiring of graduates who had been unemployed for more than a year.

By ASHLEY TANG
Read more @
https://www.thestar.com.my/news/nation/2019/10/11/budget-2020-rm500-wage-incentive-for-graduates-who-secure-work#jdh7JG7C1jwvDkdw.99

Budget 2020: DoE, DoC get RM30mil after year of pollution crisis

Saturday, October 12th, 2019

PETALING JAYA: The government will be beefing up the Department of Environment and Department of Chemistry with a RM30mil allocation to prevent another Sungai Kim Kim, Pasir Gudang and transboundary haze disaster.

Finance Minister Lim Guan Eng announced this during his Budget 2020 speech at Parliament on Friday (Oct 11).

He said RM30mil would be used to build the capacity of both departments to tackle such issues.

“The recent incidents at Sungai Kim Kim and Pasir Gudang, as well as the spread of hazardous transboundary haze are painful reminders of the importance of protecting our environment, and the cost of greed,” he said.

Lim added that in oder to mitigate the occurrence of flash floods, the government would also allocate RM443.9mil towards flood mitigation projects and RM150mil towards the maintenance of existing flood retention ponds.

“Additionally, to assist farmers in their time of need, the government will establish a RM100mil Disaster Assistance Fund to provide loans at an interest rate of 4%,” he added.

By MEI MEI CHU.

Read more @ https://www.thestar.com.my/news/nation/2019/10/11/budget-2020-doe-doc-get-rm30mil-after-year-of-pollution-crisis

Budget 2020: Every single sen for education will be used properly, says Maszlee.

Saturday, October 12th, 2019

KUALA LUMPUR: Education Minister Dr Maszlee Malik has pledged to ensure that every single sen allocated for the ministry, which received the biggest slice of the pie under Budget 2020, will be properly spent.

“The highest allocation comes with the highest sense of responsibility and accountability.

“So our priority is to make sure every sen is dedicated, budgeted and reached the targeted audience or the people that we’ve planned for, ” he said to reporters when met after the tabling of Budget 2020 in Parliament on Friday (Oct 11).

Maszlee also said the ministry would ensure that the processes of governance, integrity and channelling will be properly monitored.

“We don’t want any leakages like with the previous government, ” he said, adding that a monitoring body had been formed by the ministry after he was appointed minister last year.

The Education Ministry received the largest allocation in Budget 2020 with RM64.1bil. This was an increase of RM3.9bil from the previous year.

At the same time, Maszlee said that technical and vocational education and training (TVET) institutions would be streamlined by a task force headed by the Education Ministry.

“We have a few plans, and we are coordinating with the industry so our TVET institutions can truly produce a skilled work force and every sen we spent will produce workers who are trained.”

Under Budget 2020, RM5.9bil was allocated to the TVET, which is an increase of RM2bil from the previous year.

Maszlee also said the higher allocation was to encourage more Malaysians to take up TVET courses and to stop perceiving such courses as a “second option”.

“We want to be seen like countries such as Germany, where 60% of its citizens opt for TVET courses while the other 40% pursue academic courses.

“They don’t look down on TVET courses.”

By HEMANANTHANI. SIVANANDAMRAHIMY RAHIM and MARTIN CARVALHO & TARRENCE TAN

Read more @ https://www.thestar.com.my/news/nation/2019/10/11/budget-2020-every-single-sen-for-education-will-be-used-properly-says-maszlee

2020 Budget: Expansionary policy to continue

Friday, October 11th, 2019
Malaysians can expect a continuation of an expansionary policy and with it, goodies and incentives for some groups in the 2020 Budget. FILE PIC

KUALA LUMPUR: THE 2020 Budget, the second annual financial plan under the Pakatan Harapan government, will be a bit more challenging.

This is due to the prolonged trade war between the United States and China, the US presidential election, Brexit, protectionist European Union, geopolitical tensions in the Middle East and volatility of commodity prices.

Malaysia’s trade with other countries accounts for 130 per cent of its gross domestic product (GDP). Being an open economy, the global uncertainties will affect the country’s revenue, foreign investments, capital flows and currency exchange rate.

Despite external pressures, the economy, which grew 4.9 per cent in the second quarter from 4.5 per cent in the preceding quarter, remains resilient with solid demand, a stable job market and low inflation.

Hence, Malaysians can expect a continuation of the expansionary policy and with it, goodies and incentives for some groups in next year’s budget, which will be tabled by Finance Minister Lim Guan Eng today.

“The budget is predicted to boost domestic economic activities, take advantage of the US-China trade war and offset an external trade slowdown,” MIDF Research said in its report.

“We can also expect a further increase in the minimum wage from RM1,100 to RM1,200, lower trade and investment barriers and provision of incentives and grants for small- and medium-scale enterprises (SMEs),” it added.

TA Research said the government might announce a bonus or special payment for firemen, besides raising their service allowance.

The government is expected to impose a higher tax on rich Malaysians, enhance the Sales and Services Tax, widen taxable income bands and provide more information on the targeted fuel subsidy programme, especially on diesel.

For the middle-income group, or the middle 40 per cent, there could be a concession on personal income tax.

Industry observers said continuing the expansionary policy means that the government will keep spending more than what it earns to boost economic activities. In doing so, Malaysia’s budget deficit is expected to remain slightly above three per cent next year.

Still, the deficit has been in gradual decline since 2009, from a high of 6.7 per cent to 3.8 per cent last year.

Malaysia is on track to achieve a balanced budget in 2021, and expects this year’s deficit to be at 3.4 per cent.

Overall, industry observers said the budget will provide a clearer direction of long-term development plans, as well as a fresh attempt to restore public confidence in the administration

One pointed out that under the 2019 Budget, the focus was more on restoring people’s confidence in the government following the 2018 General Election, as well as strengthening Malaysia’s monetary and fiscal position as a result of abuse of power, mismanagement and corruption during the previous administration.

This time, policymakers will most likely emphasise bolstering the economy by creating more jobs, encouraging private investment, improving productivity and, more importantly, addressing the high cost of living and widening income gap.

Economists at Singaporean bank UOB expect policies and measures drafted in the budget to be aligned with the recently-launched Shared Prosperity Vision 2030

The blueprint is targeting an average real GDP growth of 4.7 per cent from 2021 to 2030 and nominal GDP of RM3.4 trillion in 2030.

It also aims for compensation of employees at 48 per cent of GDP, SMEs and micro-businesses to contribute 50 per cent to the GDP, contribution of Bumiputera enterprises at 20 per cent to national income, and income of not less than RM5,800 a month for the bottom 40 per cent group.

The targets will be supported by 15 key economic activities across regions, including the digital economy, Islamic financial hub 2.0, Asean hub and green economy.

“The success of this new development narrative will depend on effective policies and programmes, as well as strong political will to ensure that Malaysia moves forward to achieve these goals,” UOB senior economist Julia Goh and economist Loke Siew Ting wrote

By Zuraimi Abdullah .

Read more @ https://www.nst.com.my/news/exclusive/2019/10/528868/2020-budget-expansionary-policy-continue