Opposition to lend support to COVID-19 bill if fund injection is doubled - Guan Eng

Former Finance Minister Lim Guan Eng (PH-Bagan) felt that the allocation of RM45 billion was insufficient to restore the country's economy in the current situation.

"Although we are worried that the national debt will rise but it is more important for us to save businesses and jobs rather than worry about the national debt. We can accept it (the Bill) provided it is channelled to the people.

"The government must also ensure open tender to avoid leakages. That is very important so that the impact of this allocation is felt by all the people and not certain people," he said when debating the Bill in the Dewan Rakyat today.

A Bill to set up a RM45bil Government Covid-19 Fund was in Parliament for second reading today.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said the bill was to enable the government to increase the statutory limit on the amount of money available under the Loans (Local) Act 1959 and the Government Funding Act 1983 up to 60 per cent of the gross domestic product (GDP).

On the government’s move to raise the country's statutory debt limit to 60 per cent of the GDP from 55 per cent at present, Lim said by doubling the fund from RM45 billion, it will also help economic development and he is confident that the debt will not exceed the 60 per cent limit.

He said with the proposed allocation of RM45 billion, the fiscal deficit is expected to be in the range of 5.8 per cent to six per cent and with an additional RM45 billion allocation, it will increase to nine per cent.

"Malaysia is able to persevere because the worst fiscal deficit in the country's history in 1981 and 1982 was between 15.1 per cent and 16.2 per cent.

"So nine per cent (fiscal deficit) is not something that is very worrying and I’m confident that it will get the attention of foreign fund managers. But the most important thing is to save jobs and Malaysian businesses," he said.