2011 Election Budget

The 2011 budget is definitely an election budget (tell me something we all don’t know)

If you look at the 2010 budget, after years of consecutive budget deficit, the Prime Minister in his maiden budget announced a reduction in total spending.

"Najib mentioned about expenditure would be decreased by 11.2% "

A year later, he maintained the flip flop nature of his administration and proposed an increase of 2.8% instead, with a dismal 23% for investment/future while RM162.8 million or 77% for operating expenditure (i.e. just for day to day operations).

Is there a wavering of resolve to reduce national debt? Is this an allocation for maintaining the status quo or bringing about profound and fundamental changes that can benefit all?

From the enormous, ad-hoc and probably budget overrun causing spending spree in a series of by-elections, the cheque book administration reveals itself again. Get ready for a snap election!

Other commentators would have pointed the obvious like the sudden hike in payouts to civil servants etc. I am trying and hoping to write about the less obvious here.

The Sun provides a detail list of budget announcement here.


There is no fundamental structural change, obviously. Plenty of mega projects and for countless time, “private investment” or “private funding” is mentioned.

If you look at the existing modus operandi of “private investment” that we have Ahmad Zaki Berhad as the classic example.

It probably consist of 1) direct negotiation and award without calling for open tender and 2) the few good men (or the chosen ones).

The GLCs would probably get some bank loans and ultimately the frugal, the savings-conscious, retired and suffering Malaysians will bear the default risks arising from cost overruns, white elephants, delay in completion, continuous repair cost in the form of lower interest rates.
These bank loans to GLCs in substance another form of national debt; financed by our hard earned savings as well as the gap between the housing loan interest rates paid and the savings and fixed deposit rates received in return.

What caught my eyes too is this ambiguous statement:

* The implementation of the 12 National Key Economic Areas (NKEA) to generate investment exceeding RM1.3 trillion and create 3.3 million jobs

Sounds impressive until you look at it again:


In 1997-2001 Bill Clinton's administration created 11.2 million jobs in the United States, worked out to be approximately 2.8 million jobs per annum for a population of close to 300 million

How Malaysia with a population of 27 million can take in another 3 million new jobs perplex me.

If 50% of Malaysians are working then that is about 13 million working Malaysians so where are we going to find additional 25% of that number…more foreign workers?

No, there is a statement here”* Govt will continue to reduce the number of foreign workers by increasing in stages the levy according to sector. “

Typical example of long-on-rhetoric-lacking-in-details governance by sloganeering, from "Wawasan 2020" to "Work With Me" to "1Malaysia, Siti Inshah Diutamakan, BTN Didahukukan"

Of course central to the effort to please the business community and rakyat is....

1. Reinvigorating private investment;

Privafe-public partnerships
* In 2011, private investment is estimated to expand 12.5% to RM86 billion

Without addressing the continuing deliberate provocative actions base on racial lines, from Shah Alam Cow Head incident, to church bombing, Perkasa, BTN, racists headmasters etc, by ignoring the concerns expressed candidly by foreign investment community (ask the DPM about his comment on PERC report), I wonder where would RM86 billion private investment will come from.

If you look at the graph below, FDI is about RM25 billion (base on 2008, not 2009 numbers), so is the rest from EPF, our savings rechannelled as bank loans? The Prime Minister better explain whether he is budgeting for attracting foreign investment or mobilizing Malaysians' tax money or savings.

Or he is adding up "hot money" that comes in and out of the stock market short term basis?

To successive BN administrations, development means more and more construction projects - Putrajaya, KLCC, Matrade, KLIA, PKFTZ and Cyberjaya. Big on hardware but the multiplier effect that trickle to the rakyat is oblivious while only benefiting the developers, contractors, hardware suppliers and foreign construction workers probably. Where is the sillicon valley of Malaysia we were promised with Cyberjaya?

This budget is more of the same, only bigger, with

Another landmark development is by Permodalan Nasional Berhad — Warisan Merdeka, expected to be completed by 2020. Comprising a 100-storey tower, the tallest in Malaysia, it will retain Stadium Merdeka and Stadium Negara as national heritage. The total project cost is RM5 billion, with the tower expected to be completed by 2015.

PNB, by its name, is The Nation’s Capital Ltd. Compared to this little allocation below, where is the “People First” rallying call?
* Govt to allocate RM350 million to combat crime, including burglary, motorcycle and car thefts as well as promoting safe townships and Voluntary Patrol Scheme in high-risk areas. An additional 25 special courts to be established to expedite prosecution.

After viewing some of these excruciating websites, tax payers should ask where our money should go to. For me certainly not to another major non-open tender project to be located in the traffic jam part of Kuala Lumpur.



A 31-year-old pregnant lady .....attacked by two men on a motorcycle on Sunday. Jamilah Selamat suffered head injuries after falling from her motorcycle and died at the Sultanah Aminah Hospital at 7.30am.

Conspicuous by its absence is a discussion on Petronas fund disposition, apart from a small disclosure that “Petronas to implement regasification project with RM3 billion investment in Malacca, which will be operational in 2012.”

This is pertinent because the Prime Minister mentioned that the increase of allocation by 2.8% can be financed by forecasted revenue increase by 2.3% and since Petronas form a significant source of revenue, there should be more disclosure. The again, is it not to convenient to talk about Petronas after Pakatan Rakyat query the soundness of 2010 budget?


Anwar's motion to discuss drop in Petronas' revenue rejected

At least BN is admitting the once proud standard of English needs drastic repair measures

* RM213 million allocated to enhance proficiency in Bahasa Malaysia, strengthen the English Language and streamline the Standard Curriculum for Primary Schools (KSSR). Govt to recruit 375 native-speaking teachers including from the UK and Australia to further enhance teaching of English

But seriously, why not spend the money selecting and training competent local teachers to teach English and are you sure the Brits and Australians relish working in rural areas all over Malaysia? This does not sound like a practical and comprehensive approach to me.
* Service tax be increased to 6% from 5%. Service tax be imposed on paid television broadcasting

RTM is probably losing its appeal given its content compared to Astro. Given the lop-sided coverage in its news, perhaps many have turned off RTM. I suppose this is to compensate the loss of revenue in RTM?
By the way, there is no disclosure of the development plans following land exchange for Malaysia's rights to the land leading to Tanjong Pagar train station. Any more hidden national debts? Probably we have yet to finalise development with Singapore authorities, perhaps so probably a supplementary budget will come in and jack up the expenditure again.

What I do like to see but missing is substantive restructuring of the existing economic structure
which would address the raising cost of living issues.

Get rid with layers of rent seekers in IPP, AP holders, profit guarantees for toll operators; and also to regulate property speculation, combating corruption.

The MACC Act empowers our legal system to recover ill-gotten gains but we never manage to see any result from this. Why not incorporate this aspect to our budget - recovery of ill-gotten gain (now THAT would be a proper election gimmick ^^)

This budget is a continuation of top down, centralized allocation which marginalize the power, potential and autonomy of state governments and reflective of the Malayan Union structure which UMNO itself opposed years ago.

State governments and voters of state assembly seats continued to be marginalized and excluded when it comes to decisions pertaining to how tax and custom revenues are allocated and managed.

After all that is said and done, we tax payers never, ever get a report on how the actual revenue and expenditure fared against the previous year's budget. Every proper company exercises budgetary control. While successive UMNO Prime Ministers showcase the budgets presented, we never know how the well the promises were kept, how much or how little of the original targets have been achieved and explanations for such shortfall.

It should be fair for rakyat to demand a session for the PM to tell us actual vs budget before presenting the budget for the forthcoming year, otherwise the annual budget speeches are turning into an annual fairy tale telling without accounting for what actually transpire.


Tony Pua posted this where the actual vs budget for the past 10 years was disclosed:-


My thoughs posted at comments is as follows:
Dear Tony,

some thoughts to share with you here:

the worst overspend years are 2004 11.3 bil/14.1%; 2008 22.2 bil/17.2%; 13.9 bil 10/1% with total budget increasing from 80 in 2004 to 129 in 2008 and then 138 in 2010

for 2004 and 2008 are election years while 2009 is buy election year...so normally in vote buying season, budget will overrun

the smallest overrun of 3.9% was achieve in 2009; only because it had the biggest budget for them all 154.2; triple the size of 2000...how the hell did we need 3 times the budget to run a gomen compared to less than 10 years ago...my wages did not increase 3 times from 2000 to 2009
remember, Najib promised to cut deficit in 2010 budgetspeech and yet, he spent 152 bil i.e. about the same as the biggest budget for the past 10 years, i,e, 154.2 of 2009 budget

the question is why in 2009 there was a huge budget? is it for sloganeering for new PM, and also to pay off the out going PM who incurred the biggest election loses in BN history (and probably did not lost too much sleep over it)


  1. i would actually read it, if you stop playing with the fonts. Leave it readable.

  2. Are we sure that Malaysia is going bankrupt by 2019? At this rate it looks like we'll be bankrupt by 2014. By 2020, RM1 million will have the same value as RM20 today, just like what happened in Zimbabwe. That's UMNO's idea of a "high income society". All "banana tree" currency.

  3. Dear Anom #1, my apologies...normally I have these set of rules:

    1) if I am quoting from other sources, then the colours is altered to distinguished them from my own words
    2) for key words, I bold them, hence if readers find the whole article too long, reading only the bold words would give readers the gist of my points

    I will consider your points carefully and perhaps tone down the variation

    thank you for your feedback

    Tamil Tiger,

    cute isn't it. A year before the promise land of 2020 we are suppose to go bankcrupt...months after the doom and gloom prediction to justify subsidy lost, we can build the biggest white elephant yet