The government will continue implementing fiscal consolidation measures to ensure the country’s financial position is as strong as it was in 1992-1997, said the Finance Ministry (MoF).
The government takes the approach of refinancing debts that have reached maturity using new loans to supplement the government’s financial capability in order to remain competitive, the ministry said in a written reply to a June 13 oral query on that was uploaded today onto the Parliament’s website.
“However, to ensure the debt level is under control and manageable, several control measures must be observed to resolve the increasing debt issue,” the MoF said.
The measures include continuing fiscal consolidation measures in a gradual manner to ensure new loans are lower than those taken during the pandemic without affecting the national economic recovery, it said.
The government will also broaden its revenue base and strive for sustainable revenue collection whereby the operating expenditure is financed fully by national revenue and the government has current surplus that can be used as part of the development expenditure.
Moreover, the MoF said, the government will ensure debt service charges are manageable and do not exceed 15 per cent of revenue.
In addition, it will ensure government borrowings are solely for financing development expenditure focusing on high-impact projects and providing long-term returns to the nation and the people.
The government, it continued, will also review the method for implementing off-budget projects by focusing on mega-projects and projects that require high annual cash flow.
On the efforts to curb liabilities, the ministry said the government will limit the provision of government guarantees that would eventually raise the government’s financial commitments.
Meanwhile, the MoF said, the government, through Bank Negara Malaysia, will ensure there is no drastic or excessive change in the ringgit’s value to prevent any economic disruption and ensure the foreign exchange market situation remains orderly.
“Hence, a flexible ringgit exchange rate has an important role in cushioning against external shocks, without domestic economic activities being affected, especially amid current uncertainties in the financial markets and on global growth,” it added.
The ministry said the government has also taken more comprehensive measures to assist the people in handling inflationary pressures and high cost of living, such as through the control of goods’ prices and the Payung Rahmah initiative.
RM3.4Bil Unclaimed Monies As of May
Meanwhile, it was earlier reported that the amount of unclaimed monies (UM) being reclaimed as of May 31 this year totals RM3.4bil, according to the Finance Ministry.
The ministry said the number of applications received by the Registrar of Unclaimed Monies doubled in the first five months of 2023 compared to last year’s corresponding period, reflecting the rising public awareness about UM.
“The balance as of March 31, 2023, was RM11bil, and the amount was RM11.5bil as of May 31, 2023,” it said in a written reply to a June 13 query made in the Dewan Rakyat.
The explanation, uploaded on Friday (June 16) to the Parliament’s website, was in response to Datuk Ahmad Amzad Mohamed @ Hashim (PN-Kuala Terengganu) who wanted to know about the government’s efforts to ensure the public claims the monies and how the government utilised the RM250mil interest accrued by investing the unclaimed moneys in fixed deposits.
According to the ministry, the UM submissions registered for the first five months of this year totalled RM1.3bil, an 18 per cent jump compared to the same period in 2022.
The rise in claims was due to the implementation of enforcement operations to ensure companies and firms nationwide comply with the Unclaimed Monies Act 1965.
Meanwhile, it said that based on the Unclaimed Monies Act 1965, on the lapse of 15 years from the date the monies were credited to the Consolidated Trust Account, they would be transferred to the Consolidated Revenue Account and be used for the purpose of national operating and development expenditures based on the Budget tabled by the Prime Minister, in line with the Financial Procedure Act 1957.
“A large portion of the balance in the Consolidated Trust Account has been invested in fixed deposits in line with the Financial Procedure Act 1957. The yields from such investment are credited into the Consolidated Revenue Account for the same purpose (mentioned earlier),” it explained.
However, the ministry said, for the monies transferred to either the Consolidated Revenue Account or Consolidated Trust Account, there is no time limit for making claim applications and rightful owners are entitled to make claims at any time.
