At RM322.5billion, Malaysia Budget 2021 is the largest budget in the country’s history. But will it pass?
This post was originally posted here. The contributor to this article,@Denise is one of our many community members on InvestingNote.
While the World Bank has come forward to welcome the overall stance of Malaysia budget 2021, it is still unclear if the bill will pass.
Malaysian finance minister Tengku Zafrul Tengku Abdul Aziz tabled the 2021 national budget in parliament last Friday on Nov6; also the first budget under Prime Minister Muhyiddin Yassin’s administration.
But already, it appears the current administration is in for a bumpy road ahead. There are a lot of doubts if the budget is even able to pass because of politics.
In his budget speech, the Finance Minister has projected the economy to expand between 6% and 7% next year.
In response to that, Mr Anwar argued that the projections of development figures in the budget proposals were unrealistic and “not responsible”. He also commented that the budget was “misleading” and benefits cronies instead of the people.
Besides Anwar, The Pejuang party leader, Mahathir, also joined the disapproval of the budget in a Facebook post saying he wants it modified so that it is “more realistic”. His reasons were that the pandemic requires more money to be spent by the government, but it has also affected the Government’s revenue.
Mahathir further questioned where the money will come from, considering the deficit of about RM85 billion is much bigger than the development budget of RM69 billion.
Accordingly, there is a high possibility the passage of the budget would be blocked by Members of Parliament with a no-confidence vote against Mr Muhyiddin.
However should the bill is passed, these could mean the following for Malaysians and the economy:
i) Employee Provident Fund (EPF) account-holders will be entitled to withdraw up to RM500 per month, for one year from their EPF Account 1. Before this, account holders are only allowed to withdraw once they reach 50 years old.
ii) Certain sectors are bound to benefit from the budget 2021, and others not:
On a more positive side, the setback seemed to be avoided after the king pressed MPs from both sides of the political divide to support the Bill. It was the first time in Malaysia’s history that opinions have been sought from opposition lawmakers on the Budget’s formulation.
It is worth pointing out that the Government usually makes additional changes before the final bill is passed. After all, this is just the first reading of the budget.
Let’s hope Malaysia is able to tide through this crisis! 🇲🇾🙂 $KLCI(^KLSE.IN)