Amid the weakening of the ringgit and the global oil price slump, despite of Putrajaya should revise the 2015 Federal Budget as the Prime Minister Datuk Seri Najib bin Tun Razak has done it yesterday, Sabah state government should immediately convene a special sitting of State Assembly to revise it’s state budget for 2014, the Sri Tanjong Assemblyman Chan Foong Hin said today.
The DAP Sabah Vice Chairman said, Sabah state government should emulate Putrajaya to revise the 2015 budget. However, Sabah should do it in a better way, which is convening a special state assembly sitting. What has been practiced by the Najib administration was acting in contempt of the principle of parliamentary democracy, in which Najib has chosen to announce the revision without tabling it and debating it in parliament.
The 2015 Sabah Budget was tabled in the last state assembly sitting in November 2014, with the state has its first surplus budget since 2008. According to the budget, in 2015, the RM3.812 billion budget against an anticipated RM3.862 billion revenue.
Among the revenue, it was projected that RM1.147 billion would be the 5% oil royalty payable by Petronas to the state in 2015.
“I have asked before in the state assembly sitting that, on what basis our Chief Minister made the calculation? Assume that was calculated on the world oil price at USD100 per barrel, but now the world oil price is at USD47 only, and it could be drop further depending on the global oil politics. The slump of oil price has been translated to the huge dent in projected revenues from oil royalty to our state coffer.
The 50% drop in oil price will be equivalent to a shortfall of RM0.573 billion, near to 15% drop of the projected revenue, RM3.862 billion. As our anticipated surplus is RM0.05 billion or RM 50 million only, then the drop in oil price will easily offset the surplus.” Chan commented.
So now, the core question is, what is the planning and action by the state government to address the issue, and are we committed to maintain this year budget as the first surplus budget since 2008? Chan asked.
“What kind of new revenue the state should look for? What kind of expenses our Chief Minister prepared to slash off, including his own department? These are the agenda the state assemblyman should debate.”
“I call for a revision for the state budget as it is very basis and projections had been knocked off by the drastic fall in oil prices and other economic developments including the weakening of the Malaysian Ringgti,” he said.
A special sitting of state assembly could be convened in as quickly as 48 hours. The sitting is urgent and imperative, as apart from a revised 2015 Budget, many issues confronting the state should be debated as well.
The first issue is the report on the Royal Commission of Inquiry (RCI) on Sabah’s Illegal Immigrants, as the state assembly should debate whether the state should endorse the suggestion of the report which is merely “committee after committee” time buying measure.
“Second, for the new state sales tax imposed on seafood export started this year, as I have questioned the legality of the implementation which is without any amendment of the enactment, should bring forward for debate in the special state assembly sitting as well. I agree with searching for new revenue for the state, but it should not burden the seafood industry specifically and the people generally.”
Third, as the postponement in the electricity tariff are among the highlights in Putrajaya’s revised budget, the Musa state administration should revise both electricity and water tariff to bring some cheer to Sabahan consumers. Following the slump world oil price, power generation cost should be cheaper and it is imperative to revise the electricity tariff to lower price, not mentioning the poor service provided by Sabah Electricity Sdn Bhd. The new water tariff started in this year which sees a 70% hike for industrial users should be deferred and then revised. As the new water tariff was announced by State Infrastructural Development Minister Tan Sri Pairin Kitingan during his ministry winding up remarks in last November sitting, it was never debated thoroughly by the people representatives.
Fourth, a resolution to urge the federal government to defer the Goods and Services Tax (GST) until Malaysia achieve the status of a developed and high income nation, should be proposed by the Musa Administration in this special state assembly sitting. The GST which is scheduled for implementation on 1st April, needs to be delayed, as increasing financial burden on the people due to rising living costs and difficulties faced by those in flood hit states, including Sabah as well. The people should not be made as scapegoats of declining economy. Furthermore, Sabah has been entrapped in higher cost of living thanks to cabotage policy and lacking of infrastructure.
“Therefore, I call upon a special state assembly sitting to revise the 2015 state budget, and debating for the RCI report and new seafood export tax, as well as revising the power and water tariff. A resolution on deferring GST should be proposed and debated. ” Chan concluded.