PETALING JAYA: Education, health and welfare should not be subjected to any austerity measures, says an economist ahead of the first national budget since the change of government in the last general election.
Instead, Professor Yeah Kim Leng of Sunway University Business School said the Pakatan Harapan government should curb spending by cutting back on the defence sector, and ensure that fuel subsidies reach only the deserving.
Yeah said the cuts should not go beyond the next budget.
“One year of budget cuts should be good enough for the government to recover from the national debts. Next year on, the government should have a better budget,” he told FMT.
Prime Minister Dr Mahathir Mohamad recently said the federal budget would include measures to save money due to some RM1 trillion in national debts.
Yeah said financial prudence must be applied selectively, especially when it came to infrastructure.
“Only carry out projects that need immediate attention such as upgrading airports or roads,” he said, adding that the government could also be frugal in its spending for next year.
He said projects that would encourage market growth and create jobs should be prioritised.
Yeah also felt the government should be prudent in emoluments, saying the size of the civil service should be kept under control.
“The government could have internal transfers to fill the positions of retired officers,” he added.
He said debt servicing in the federal budget should be lowered to single digits so that the government does not spend too much revenue on paying debts.
“The lesser the debt servicing, the more Putrajaya will have to spend on the rakyat.”