KUALA LUMPUR, Feb 28 (CNA) - Amid calls for a review of civil servants’ salaries in Malaysia, Prime Minister Anwar Ibrahim said on Monday (Feb 27) that no salary increments were proposed for them in the 2023 Budget as doing so could lead to a large budget deficit.
“Our problem now is (we have) a debt of RM1.5 trillion (US$335 billion) with (a current) deficit of 5.6 per cent.”
“If we increase the salaries, our budget deficit may rise to 6.5 per cent,” Mr Anwar was quoted as saying by Bernama after delivering a keynote address at the International Forum on Islamophobia.
Mr Anwar, who is also the finance minister, added that a high budget deficit could deter potential investors from investing in the country.
“Nobody will come and invest in our country because they will have no confidence that we have a strong political will to manage the country well,” he reportedly said.
Mr Anwar also called on civil servants to be patient as the government’s priority is to help the poorer groups of the people.
“Just be patient for a while. Is it not important to try to help the hardcore poor who suffer more than the regular workers?
“Life is also hard for the paddy farmers, fishermen and the hardcore poor … they are also struggling to make ends meet,” he was quoted as saying by Bernama.
After the tabling of Budget 2023 on Friday, Congress of Union of Employees in the Public and Civil Services Malaysia (CUEPACS) president Adnan Mat said that there was no commitment shown by the government in the proposed budget to increase the salaries of civil servants.
According to The Star, Mr Adnan said that civil servants wanted a new remuneration system, adding that the current one has not been reviewed since November 2002 and is not suitable in the current economic climate.
It was announced during the tabling of the budget that civil servants in management and professional groups, as well as those in support groups Grade 56 and below, will receive a special financial aid of RM700 for Hari Raya Puasa. A special aid payment of RM350 would also be given to civil servants on contract as well as government pensioners.
The 2023 expansionary budget of RM388.1 billion tabled on Friday is the largest in the country’s history. Mr Anwar had announced a slew of measures aimed at lowering the cost of living amid high inflation as well as more progressive taxes.
He said then that high national debt remains a constraint and that it will reach RM1.2 trillion in 2023 - more than 60 per cent of the gross domestic product (GDP). The debt reaches RM1.5 trillion when liabilities are included.
At the tabling of the 2023 Budget, Mr Anwar added that the fiscal deficit in 2023 is projected to decrease to 5 per cent of GDP, compared with 5.6 per cent in 2022. He also said that the aim is to reach 3.2 per cent by 2025.
Mr Anwar stressed that as a result of this debt, Malaysia is on the “threshold of a critical period in its history".