Najib’s figures on Budget revision inconsistent

DAP’s Ong Kian Ming say it is absolutely necessary for the Prime Minister to table the revised budget in Parliament.

KUALA LUMPUR: Prime Minister Najib Abdul Razak’s inconsistent budget figures make it more difficult to sceptics to believe the accuracy of the revised numbers for Budget 2015, according to Serdang MP Ong Kian Ming.

Firstly, he pointed out in a statement, that Najib announced that the “Development Expenditure of RM48.5 billion for 2015 will be maintained and spent.” “This statement by Najib is highly confusing since in his 2015 Budget Speech, the development expenditure was announced to be RM50.5 for 2015,” said Ong.

“While a difference of RM2.0 billion may not seem like a lot to Najib given than it represents less than 1 per cent of the overall budget, this kind of discrepancy calls into question whether or not he has a good grasp of the exact estimates of the revised budget deficit in absolute terms.”

In his speech on Tuesday, he also stated that the “Consensus among economists is that the forecast price of USD100 per barrel used in the 2015 Budget is no longer realistic. They now estimate the average oil price in 2015 to range from USD40 to USD70 per barrel, he noted.

“But according to the Treasury’s Estimates of Government Revenue 2015, the oil price used to calculate the 2015 budget was USD105 per barrel and not the USD100 stated by Najib in his speech on Tuesday.”

A difference of USD5 per barrel was not a small amount, added Ong. “A change in the estimate for the price of oil from USD110 per barrel in 2014 to USD105 per barrel in 2015 resulted in an estimated decrease of RM2.675 billion in the Petroleum Income tax from RM28.275 billion in 2014 to RM25.6 billion in 2015 representing a 9.5 per cent decrease.”

While Najib and those in the Ministry of Finance may argue that the difference of USD5 per barrel was as a result of using the price of the Tapis blend of crude oil which is found in Malaysian waters and sold at a premium to Crude Oil Brent, conceded Ong, “these seeming discrepancies raises doubts as to the accuracy of the revised budget figures presented by Najib.”

It was telling that Najib chose not to present a revised estimated budget deficit figure but instead presented the revised budget deficit as a percentage of GDP, in this case 3.2 per cent versus 3.0 per cent for the originally announced budget, continued Ong.

“The estimated budget deficit for 2015 was RM38.7 billion according to Najib’s 2015 budget speech last year but no new figure was given during the revised budget speech.”

Could it be that Najib himself is unsure of what the estimated budget deficit is in absolute terms, after the most recent budget revisions?

“These discrepancies and many other related questions pertaining to the revised budget is why we feel it is absolutely necessary for Najib to table the revised budget in Parliament,” said Ong.

Members of Parliament can seek greater clarification during the ensuing budget debate, stressed Ong, and the two Finance Ministers as well as the two Deputy Finance Ministers can illuminate the larger public regarding these revised budget figures.

“As it is, Najib, with his inconsistent figures, have not convinced his skeptics in the market nor many of his fellow MPs in Parliament.”