Dewan Rakyat fast-tracks emergency bills

Both the Covid-19 Bill and NSC Act are passed at the committee stage following debates by lawmakers from both blocs


THE Dewan Rakyat yesterday passed two bills that had been fast-tracked through Parliament, as Putrajaya seeks to pass all Covid-19 emergency bills before the current sitting ends on Thursday.

Both the Temporary Measures for Government Financing (Coronavirus Disease 2019 [Covid-19]) Bill 2020 and National Security Council (NSC) Act were passed at the committee stage yesterday following debates by lawmakers from both blocs.

The Covid-19 Bill seeks to support the various economic stimulus packages including the Prihatin Rakyat, the Prihatin SME and the short-term National Economic Recovery Plan.

The bill will also see the establishment of a RM45 billion Covid-19 Fund, which accounts for the government’s direct fiscal injection into two of the stimulus packages.

In his winding-up speech, Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz (picture) said the country’s economic stimulus package was derived from domestic loans as Malaysia has sufficient financial liquidity of RM146 billion, thus lowering the risk of foreign exchange.

He said the government would opt for domestic financial instruments as it can reduce foreignexchange risk exposures and refinancing risks.

“Any issuance of international bonds or sukuk should have strategic objectives, especially in developing the global sukuk market, as well as creating new benchmarks as a measure and reference for the issuance of private sector securities for international investors.

“Bank Negara Malaysia (BNM) also announced a reduction in the statutory reserve requirement (SRR) ratio of 100 basis points to 2% in March 2020, and additional SRR flexibility given to principal dealers by recognising Malaysian Government Securities and Malaysian Government Investment Issues as part of SRR compliance,” he said.

The move, Tengku Zafrul said, has added liquidity worth RM30 billion to the banking system and is part of BNM’s ongoing efforts to ensure that liquidity is sufficient to support financial intermediation activities.

He said the tabling of the Covid-19 Bill will only involve a direct fiscal injection of RM45 billion as it was a sum of money that will be spent from the consolidated fund.

Of the capital allocated, RM30.61 billion has been disbursed, comprising mostly of the wage subsidy programme.

In debating the Covid-19 Bill, many lawmakers urged the government to double the stimulus package to fight against the pandemic and help the nation’s economic recovery.

Opposition leader Datuk Seri Anwar Ibrahim said the amount should be increased from the current allocation of RM45 billion to RM90 billion.

“Malaysia’s GDP contracted by 17.1% in the second quarter of this year, which has been among the worst since the 1990s financial crisis and Malaysia has one of the lowest stimulus packages to fight Covid-19 compared to other Asean countries.

“Our stimulus package is only about 3% of our GDP. We have one of the highest drops for GDP, but the lowest stimulus package compared to others,” he said.

In comparison, Anwar said Indonesia’s GDP is expected to contract by 5.32%, but their stimulus package is 3.5% of the GDP.

In Thailand, GDP is expected to drop between 12% and 13%, but their stimulus package is 11.8% of their GDP.

Tengku Zafrul responded by saying the government is ready to inject more funds for the stimulus package considering the situation at the given point of time.

“We are clear, consistent and have said many times that the government will monitor the situation from time to time.

“We need to be dynamic; it is a dynamic plan and the government will act in a proactive manner,” he said.

He also clarified that compared to other countries, Malaysia’s stimulus assistance was more than 10% of GDP and not 3% as claimed.

“The stimulus assistance of other countries also considers the contribution of the entire ecosystem.

“These include government guarantees, the resources of banking institutions and their respective tax incentives,” he said.

Meanwhile, the NSC Act which proposes to remove the powers of the prime minister to declare a security area was passed in the late evening.

Once passed in the Dewan Negara, the powers will rest in the hands of the Yang di-Pertuan Agong, on the advice of the NSC.