Malaysian government needs back-up plan in case Petronas payment fails, some MPs say

KUALA LUMPUR — Several MPs have expressed concern over Malaysia’s 2023 budget presented on Friday, saying it was based on the expectation of a large dividend from state oil company Petronas.

Referring to the budget’s expectation of a RM35 billion (S$10.7 billion) dividend to the Petronas government, former second finance minister Johari Abdul Ghani of the ruling Umno party said the government had to have a contingency plan in case it didn’t work.

“What happens if Petronas is unable to pay RM35 billion to the government? he said during TV3’s post-budget analysis broadcast live on Friday.

This concern was echoed by Keadilan Rakyat Party MP Fahmi Fadzil.

“RM35bn is expected in 2023 – will that really be the case? We’ll have to wait and see,” he told the Straits Times.

“I also wonder if the government will be able to maintain the amount of subsidies given this year and past years, especially for food and cooking oil, and how will it pay for all of this.”

He added: ‘You can tell it’s an election budget by the amount of freebies they gave out.

“Whether civil servants or single people, more than eight million households will benefit,” he said, referring to bonuses and salary increases for civil servants and cash distributions for certain segments.

“In addition, there is the reduction of income tax for certain tax brackets.”

Democratic Action Party MP Chan Foong Hin hailed a tax cut for micro, small or medium-sized enterprises (MSMEs) of 17% to 15% on the first taxable RM100,000.

“It will give MSMEs some breathing space as they focus on rebuilding their businesses after two years of braving the onslaught of restrictive Covid-19 control measures,” he said.

However, he wondered if the budget would even have legs.

“Since there has been heavy speculation about the early dissolution of Parliament, will this budget even see the light of day? Or will they just be sweet words that Barisan Nasional intends to dangle before voters to the next elections?