Worries over ballooning emolument


The government should look into the higher allocation for emolument in Budget 2018 at RM79.15 billion, almost a RM1.75 billion increase compared to 2017.

Former World Bank economist Lim Teck Ghee said the emolument allocation is the main concern, and it has been the same in past budgets.

“The government has yet to deal with the elephant in the room, which is squeezing out development funding and expenditure in other important sectors. This is because of the increasing size of the work force within the civil service.

“Whether it is more or less than 1.6 million civil servants mentioned by Second Finance Minister Datuk Seri Johari Abdul Ghani (picture) , there is no doubt that a major part of the country’s budget is going towards paying the salaries of civil servants and their pensions,” he told The Malaysian Reserve.

He said the high cost of emolument has left little room to trim the deficit, or increase allocations for public housing, health, education and transport, or other growth and productivity enhancing investments.

“Neither the ruling party, nor the Opposition appeared to be able to deal with this major structural impediment to our socio-economic development,” Lim said.

In February, it was reported that Malaysia has the highest number of civil servants in the world — with one civil servant in every 19.37 people.

Johari was quoted to have said one of the issues faced by the government was to address the ever increasing government operating costs and expenses.

However, the minister said the government did not have any plans to reduce the number of civil servants, despite the soaring remuneration and pensions to civil servants.

Meanwhile, the allocation for other expenditures increased from RM816 million to RM1.08 billion. Economist Tan Sri Dr Ramon Navaratnam said the government should be transparent on the exact allocation for miscellaneous items.

“For just miscellaneous items, the extra RM264 million does add up a lot. The government should explain, and be both transparent and accountable, on how the funds will be used.

“It should be clear as the sum is too big to lump under extra expenditures,” he said.

Overall, he said Budget 2018 was prudent and generous as he hopes the target of 2.8% budget deficit can be realised in 2018.