The nation’s debts and liabilities stand at about RM1.5 trillion, or 82% of the gross domestic product, Anwar said during Question Time in the Dewan Rakyat. That includes 1MDB’s debt of RM18.2 billion, he said.

“The steps we are taking to manage this, firstly, is to improve governance,” he said. “Some of the billion ringgit spending lost was because of weak management (and) leakages, which caused debts to be higher than the economy’s growth.”

Anwar said the government has no plans to reintroduce the goods and services tax, which was abolished by the Dr Mahathir Mohamad administration in 2018. Instead, it would continue to lower subsidies for the rich and review public spending without burdening the poor, he said, pointing to the adjustments in electricity tariffs announced in December.

Malaysia, which runs Southeast Asia’s widest fiscal deficit after the Philippines, has seen its budget strained by the cost of keeping essentials at below-market prices. Government subsidies were forecast to reach a record RM80 billion in 2022, with concessions on fuels and cooking gas alone projected to account for about half the amount.

Anwar, who doubles as the finance minister, is set to table the revised 2023 budget in Parliament on Feb 24, and has been preaching fiscal prudence as Malaysia stares down still-elevated debt levels in the wake of a Covid-era spending drive.