The 2024 Budget – Overall Stance
- With the global economy subjecting to downside risks and slowing domestic economic conditions, the 2024 National Budget is framed as fiscally sustainable and responsible for sustaining economic growth, addressing cost of living pressures, and reforming for future-proofing Malaysia to strategically move forward.
- Minister of Finance focused on providing a platform for continued fiscal consolidation to strengthen fiscal health whilst at the same time continuing to support economic growth, build capabilities, drive technology and new investments in emerging sectors, as well as continuing assistance for lower-income households to cope with the rising cost of living. The Budget also focuses on education and healthcare services, food security, clean energy transition, ESG initiatives, human capital formation and the provision of services for the aged community.
- The Budget proposed an appropriation of RM90 billion DE for 2024, a decline of 7.2% from RM97.0 billion in 2023, partly due to an absence of the US$3 billion allocation for the redemption of 1MDB Bond in 2023. Of the total DE allocation, there are about 2,000 new projects with an estimated initial cash flow of RM8.0 billion in 2024.
- We have always questioned the effectiveness of public spending and the Ministries’ and agencies’ implementation capacity. The Government must institutionalize the results-oriented approaches to budgeting and management of the Budget allocation for Ministries, moving the focus of decision making in budgeting away from “How much allocation can the Ministry get?” towards “What can the Ministry achieve with this allocation?”. The Ministry of Finance can use performance results to hold Ministries and agencies accountable for their performance.
- Since a comprehensive study of the salary and retirement scheme for civil servants will be completed in 2014, credible civil service reforms are needed to improve the quality and value of public services-based performance and productivity-linked salary system. These include rightsizing civil servants and accelerating digital government.