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Free Malaysia Today
2 days ago
- Business
- Free Malaysia Today
Federal debt at RM1.3tril as of end-June
Deputy finance minister Lim Hui Ying said the government remains committed to achieving a fiscal deficit target of below 3% of the GDP, and keeping the debt-to-GDP ratio under 60% in the medium-term. (Bernama pic) KUALA LUMPUR : Malaysia's federal debt rose to RM1.3 trillion at the end of June, largely driven by continued fiscal deficits to fund public development spending, says deputy finance minister Lim Hui Ying. Speaking in the Dewan Rakyat today, Lim said the increase from RM1.25 trillion at the end of last year was to support strategic development expenditure, including infrastructure, education, healthcare, and social protection programmes. She said the fiscal deficit reduced from 5.5% of the gross domestic product (GDP) in 2022 to 4.1% last year, and is projected to fall further to 3.8% in 2025. Debt growth is also slowing, from 10.2% in 2022 to 6.4% in 2024, with a further drop to around 6% projected for 2025. 'This is in line with the government's commitment to achieving a fiscal deficit target of below 3% of GDP, and keeping the debt-to-GDP ratio under 60% in the medium-term, as provided under the Public Finance and Fiscal Responsibility Act,' Lim said in response to a question from Ngeh Koo Ham (PH-Beruas) during an oral question-and-answer session. Lim also outlined several control measures to curb debt growth, including broadening revenue base, rationalising subsidies, and enforcing strict guidelines for government guarantees and public-private partnerships. She said future borrowings would also be limited to high-impact development projects, while government guarantees would be capped at 25% of the GDP under the Public Finance and Fiscal Responsibility Act. To strengthen governance, enhance accountability, and improve institutional efficiency, the government is in the process of drafting the Government Procurement Bill and another bill to regulate state-owned enterprises, she added. BMI, a Fitch Solutions company, previously reported that Malaysia would likely miss its fiscal deficit target this year, as spending was seen exceeding projections and revenue might fall. Separately, Lim said household debt in Malaysia stood at RM1.65 trillion as at the end of March 2025, or 84.3% of the GDP. She said this should be viewed in the context of household financial assets remaining significantly higher than the total debt, indicating that the public's overall financial position remained strong. 'On aggregate, household financial assets continue to exceed debt by 2.1 times, providing a solid buffer for households,' she said in response to Awang Hashim (PN-Pendang), who inquired about the debt-to-GDP ratio. She added that the government and Bank Negara Malaysia remained committed to assisting credit users who faced financial difficulties.
The Star
2 days ago
- Business
- The Star
Federal debt up RM50bil to RM1.3 trillion, says Deputy Finance Minister
KUALA LUMPUR: The Federal Government's debt has risen to RM1.3 trillion as of March 2025, up from RM1.25 trillion at the end of last year, while total liabilities stood at RM384.6bil compared to RM384.8bil previously, says Lim Hui Ying. The Deputy Finance Minister said the increase was due to the government's need to finance fiscal deficits to support development expenditure (DE). "Government borrowings are utilised prudently to fund strategic development projects such as infrastructure, education, healthcare and social protection programmes," she told the Dewan Rakyat during Question Time on Tuesday (July 29). She was responding to a question from Datuk Ngeh Koo Ham (PH-Beruas) on the government's efforts to manage its rising debt and liabilities. Lim said the government would continue to optimise public spending through subsidy rationalisation, statutory body reforms and a comprehensive review of government expenditure. She said other steps being taken include a gradual fiscal consolidation strategy, broadening the revenue base and ensuring sustainable revenue collection. "Government borrowings are strictly channelled to fund DE projects and programmes that generate long-term benefits for the country and the people. "In addition, we have set a 25% ceiling on government financial guarantees as a share of GDP under the Fiscal Responsibility Act 2023 to ensure our financial exposure remains within manageable levels based on current economic capacity," she added. Lim also noted that the government is prioritising user-pay oriented projects under the 2030 Public-Private Partnership Master Plan to reduce its financial burden. "Other measures include reviewing off-budget project implementation methods and only considering development projects that fall within the scope and ceiling of the Five-Year Malaysia Plans," she said. Lim said strategic initiatives such as the National Energy Transition Roadmap, the New Industrial Master Plan 2030 and the Government-Linked Companies Empowerment and Reform Programme, along with policy enhancements like minimum wage adjustments, are expected to stimulate economic activity, strengthen government revenue and reduce reliance on borrowings. "The government is also committed to institutional reforms in support of the national development agenda, including the tabling of the Government Procurement Bill to improve procurement processes and governance. "In addition, a new law on state-owned enterprises is being drafted to enhance corporate governance, boost accountability and optimise performance," she said.
New Straits Times
2 days ago
- Business
- New Straits Times
Govt's debt rises to RM1.3 trillion as of end-June
KUALA LUMPUR: The federal government's debt rose to RM1.3 trillion as of the end of June this year, up from RM1.25 trillion at the end of last year. Deputy Finance Minister Lim Hui Ying said the increase was driven by borrowings to finance fiscal obligations and fund development projects. "Government loans are used prudently to finance strategic development projects such as infrastructure, education, health, and social protection programmes," she said in the Dewan Rakyat today. However, by March, the government's liabilities shrank to RM384.6 billion, compared with RM384.8 billion at the end of last year. The federal government's gross borrowings stood at RM197.5 billion in 2024, a decline from RM226.6 billion recorded for the same period in 2023. She said the reduction reflects ongoing fiscal consolidation efforts, with the fiscal deficit narrowing from 5.5 per cent of Gross Domestic Product (GDP) in 2022 to 4 per cent last year, and projected to fall further to 3.8 per cent this year. This is in line with the government's medium-term commitment to keep the fiscal deficit below 3 per cent of GDP and the debt-to-GDP ratio under 60 per cent, as outlined in the Public Finance and Fiscal Responsibility Act 2023, the deputy minister said. "As such, the rate of debt increase showed a downward trend from 10.2 per cent in 2022 to 6.4 per cent last year, and is expected to further decline to 6 per cent this year," she said today. Lim was responding to Datuk Ngeh Koo Ham's (PH-Beruas) parliamentary question on the government's effort to reduce federal debts and liabilities.
The Sun
11-07-2025
- Business
- The Sun
Use of EPF for healthcare insurance ‘very bad idea'
PETALING JAYA: Health Minister Datuk Seri Dr Dzulkefly Ahmad has assured that using the Employees Provident Fund (EPF) Account 2 for the proposed Medical and Health Insurance Takaful scheme is entirely voluntary. However, economists warn that further depleting retirement savings is 'a very bad idea' and could compromise an individual's long-term financial security. Economist Prof Geoffrey Williams said the EPF's core function is to secure retirement savings, a role that becomes increasingly vital as Malaysia transitions into an aged society by 2040. 'By then, around 17% of the population, or nearly seven million people will be over the age of 60. 'Most will either stop working or have reduced income, yet face rising living costs, especially for healthcare. Using retirement funds now for insurance could worsen financial insecurity later in life.' He also highlighted that almost 97% of EPF contributors already have inadequate savings, with half having less than RM10,000. 'There are seven million Malaysians with no formal retirement scheme at all, and only 8.8 million EPF members are currently active. The idea of depleting EPF savings further is a very bad idea.' Williams stressed that EPF is a retirement fund, not a general-purpose social safety net. 'It's not designed to function as a social insurance scheme (provider) and shouldn't take on that role. The danger is turning the EPF into a general savings account, like what we saw during the pandemic withdrawals. 'The EPF is not an ATM. What's next? Using it to pay for car insurance or even pet insurance?' Williams also pointed out that EPF holds RM1.25 trillion in total funds, with about 15% or RM187.5 billion in Account 2. He said even if only 1% is used, it amounts to RM1.875 billion potentially flowing to private insurance companies. 'It gives the impression that this is more of a patronage project benefiting insurers rather than a genuine attempt to fix healthcare financing.' Williams proposed that the government develop a holistic and structured healthcare funding system that benefits all 30 million Malaysians. 'The ideal model is one in which both public and private healthcare services are available, but payments are made by the government. As the sole purchaser, the government would have greater control over prices, costs and quality.' To finance such a system, he suggested introducing a 1% e-payments tax, which could generate up to RM28.8 billion annually. 'Alternatively, a 'Malaysian Superfund' similar to pension superfunds in other countries could be established to strengthen retirement financing.' Echoing similar concerns, Universiti Teknologi Mara senior lecturer Dr Mohamad Idham Md Razak said economically, healthcare is best supported through pooled-risk systems, such as national health insurance or tax-funded programmes, rather than relying solely on individual savings. He said while EPF can play a supplementary role, a strong social safety net ensures broader accessibility and prevents undue pressure on retirement funds. 'Retirement savings are designed for long-term security, whereas healthcare expenses are unpredictable. 'A more sustainable approach could involve separate mechanisms specifically for healthcare savings or enhanced public health coverage, ensuring that EPF balances remain intact for their primary purpose, which is retirement.' Mohamad Idham also warned that for lower and middle-income earners, early EPF withdrawals may reduce their retirement savings over time due to lost compounding growth. He urged policymakers to consider complementary measures, such as financial education or incentives to replenish withdrawn amounts, to help these groups maintain adequate retirement funds while addressing immediate healthcare needs. 'Providing flexibility for EPF contributors to use savings for health insurance could offer short-term benefits. 'But it's important to balance this with long-term retirement security. A well-designed opt-in system, with clear guidelines on withdrawal limits, could help individuals make informed decisions without compromising their future financial stability.' In June, the government proposed allowing EPF members to use Account 2 savings for monthly health insurance premiums, aiming to expand coverage as 32% of healthcare costs are currently paid out-of-pocket.
Borneo Post
08-07-2025
- Politics
- Borneo Post
High Court orders TikTok account holder to pay RM100,000 to Rosmah for defamation
The judge said that although Rosmah had been convicted by the High Court over the RM1.25 billion solar hybrid project in Sarawak, and she is currently appealing at the Court of Appeal, damages in a defamation claim must be assessed without reference to that conviction. – Bernama file photo KUALA LUMPUR (July 8): The High Court today ordered a TikTok account holder to pay damages of RM100,000 to Datin Seri Rosmah Mansor in a defamation suit filed by the wife of former Prime Minister Datuk Seri Najib Tun Razak. Judge Datuk Ahmad Shahrir Mohd Salleh ordered Ku Muhammad Hilmie Ku Din, 35, to pay the amount to Rosmah, after finding that the plaintiff had successfully established her entitlement to damages for defamation. 'This court finds a global award in the sum of RM100,000 for general and aggravated damages. This court has decided not to award exemplary damages. 'The claim for exemplary damages is not allowed as there is no cogent evidence before this court to support such an award,' he said during the decision for the assessment of damages today. The proceeding was held online. The court ordered interest of five per cent per annum on the judgment sum to be imposed from the date of judgment until full satisfaction of the award. Ku Muhammad Hilmie Ku Din, 35, was also ordered to pay costs of RM20,000. In his judgment, Ahmad Shahrir said the court found that the defamatory allegations levelled against Rosmah impute her involvement in supernatural practices and associate her with spiritual entities. 'These imputations constitute an attack on her character in the domains of religious integrity and moral standing. 'In a societal context where religious values and moral propriety carry significant weight, such allegations assume a particular seriousness and have the potential to cause distinct reputational harm,' he said. Ahmad Shahrir said he had considered the judicial trend towards moderation in damages, describing it as compensatory in nature and not intended to be punitive. The judge said that although Rosmah had been convicted by the High Court over the RM1.25 billion solar hybrid project in Sarawak, and she is currently appealing at the Court of Appeal, damages in a defamation claim must be assessed without reference to that conviction. Ahmad Shahrir said her conviction cannot be relied upon as evidence of bad character for the purpose of reducing the quantum of damages. During the proceedings today, counsel Datuk Abu Bakar Isa Ramat and Mohamed Baharuden Mohamed Ariff appeared for Rosmah. On May 28 last year, Rosmah, 73, obtained a judgment in default from the High Court against Ku Muhammad Hilmie after he failed to respond to the suit within the stipulated timeframe. Rosmah, who filed the suit on Sept 19, 2023, alleged that Ku Muhammad Hilmie uploaded a video on his TikTok account containing defamatory and false statements against her on March 22, 2023. She claimed that the defamatory statement, among others, implied that she had committed sinful acts, was associated with activities involving the devil, bomoh (shaman) and an evil individual who engages in syirik (idolatrous) practices. Rosmah contended that the publication of the statements seriously damaged her reputation as the wife of Malaysia's sixth prime minister and as a patron of various charitable organisations. – Bernama Court defamation case lead Rosmah Mansor TikTok
