(First published in theSun on 27 October 2016 here).
MUCH is made over the budget speech tabled by the prime minister in Parliament in October each year.
And rightly so, since it is supposed to be the government’s financial blueprint for the following year: how much goes where, to whom and for what.
What most Malaysians do not realise is that the budget speech is not the budget.
The speech is meant to articulate an overarching theme, specifying which areas are given emphasis in the coming year.
Perhaps the prime minister might point out anomalies, new schemes and goodies to benefit specific groups.
The problem arises when the speech is all that people use as a basis to assess the value of the budget’s various allocations. In order to truly have an accurate representation of the budget, one would need to carefully scour through the extremely thick, heavy document named “Estimates of Federal Government Expenditure”, or “Anggaran Perbelanjaan Persekutuan”.
But how many people would have the time or energy to do this unless it is part of their jobs to analyse the budget?
One example of how this can cause confusion is as follows.
Although the prime minister’s speech mentioned the government would allocate RM30 million for women to receive mammogram screenings and Human papilloma virus (HPV, or the virus that causes cervical cancer) vaccinations for free, these do not appear in the budget lines of the Ministry of Women, Family and Community Development unlike previous years.
Neither can the budget line be found within the Ministry of Health chapter.
You can download the individual ministry budgets from the Treasury website (www.treasury.gov.my) and see for yourself. The line items are simply not there.
This is not to say, however, that the budget speech was deceptive in announcing one thing and executing another.
At this point, the conservative view to take would be that it is in fact embedded in some other line item elsewhere. But this is the thing: the budget is supposed to be easy, not confusing, to read.
There are many instances in the budget documents where descriptions are general and vague at best. For example, line items like the coordination of “Special Projects” allocated RM320 million for 2017 under the Prime Minister’s Office – the specific projects are not listed.
Another example is the announcement of RM80 million being allocated to prevent and control dengue and zika, including the expansion of community health empowerment programmes, in the budget speech.
A quick check of the Ministry of Health’s “Disease Control” line item shows us a total allocation of RM721 million, presumably for all diseases.
The exact amounts allocated towards dengue and zika are not clearly broken down, a problem for those concerned with the rise of these diseases.
Another curious line item is found in the Ministry of Finance budget, which allocates RM204 million to “Various Equity Injections”. Which entities these equity injections are to be made is also unclear, although it does say an additional RM30 million will be raised via borrowings for the same purpose.
The government’s standards for presenting the budget to its Malaysian citizens are below par. And there is international evidence to show for it too.
In the Open Budget Index 2015 (OBI), Malaysia scored 47 out of 100, and is placed in the “Limited” category, which is classified as providing insufficient information.
We perform particularly poorly in the areas of public participation and budget oversight by legislature, or Parliament.
Based on the OBI, some of the weaknesses in the current budgetary process are that our budget does not contain information like the financial assets or total liabilities of the budget year (in this case, 2017) – and what the impact of these liabilities would be on the government’s financial situation.
The government also does not provide a medium-term fiscal strategy and forecast assessment of sustainability of current policies.
One could continue examining the budget thoroughly and find many places where the information is simply not detailed enough for us to have a
clearer picture. But this essentially goes back to the question of whether the government is keen on adopting openness as a practice or not.
At a conference last week on the Open Government Partnership, various speakers shared about how countries around the world including the UK, the Philippines and Indonesia – that have all signed up to this voluntary partnership that brings government and civil society together – are introducing amazing tools to first, improve public service efficiency and second, improve governance via transparency.
Open data is one such way to get there. Our government already has an open data initiative, currently being implemented by government agencies Mampu and MDEC, where selected open data sets are shared for free access at www.data.gov.my (open meaning they are publicly accessible, machine-readable and reusable).
But there is a mismatch here – where one arm of government attempts openness and transparency whilst another is deliberately vague.
One thing is clear: Anyone analysing the government budget cannot and must not restrict oneself to the budget speech alone; verifying whatever has been stated in the speech by cross-examining the actual federal government expenditure document is crucial.
To that end, a more detailed breakdown of allocations is needed in place of general aggregated amounts. This would allow people to verify whether what is announced is really being allocated funds, and in the following year, check that the funds were actually used for the purpose.
The prime minister in his speech said Malaysia is not a failed state because it has in fact implemented its responsibilities and basic functions of a government.
Well, this depends on what you consider to be government’s role. I would argue that government’s most important function is to secure the rights and freedoms of individual citizens.
And the right to information is key; in this case, budget information.
Let us truly not become a failed state, Mr Prime Minister.