KUALA LUMPUR, March 8 (Bernama) -- Prudent spending without being greedy will ensure that the government achieves its 2023 fiscal deficit target of five per cent of gross domestic product, said Economy Minister Rafizi Ramli.
“If the government has set a fiscal deficit target of five per cent, it means there is a particular amount of debt that the government would take on and the government would spend within the fixed amount,” he said during the Supply Bill 2023 winding-up session at policy level in the Dewan Rakyat today.
He explained that the retabled Budget 2023 hinges on several key projections, including the national economic growth rate and prices of the nation’s main commodities such as petroleum and palm oil.
Based on calculations, the government could forecast how much revenue it would collect and compare the projected revenue against the operating and development expenditure requirements, he said.
“The allocation for the development expenditure actually depended on the deficit target that had been set by the government because the development expenditure is paid using debt,” he said.
Rafizi said in setting the target, the government also took into consideration Petronas’ lower dividend payout and projects to be implemented.
“This means that if the allocated funds (for the projects) were not misappropriated and were spent in a transparent manner, the deficit target could be achieved, because we only borrow what is needed and use the money for approved projects,” he said.
Rafizi also said the government’s prudent management of spending and reducing the need for taking on debt will allow the government to carry out more projects for the people successfully.
.He said it will also give fiscal space for the government to provide direct assistance to the people, especially the vulnerable groups such as the bottom 40 per cent income (B40) and hardcore poor.
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