GEORGE TOWN – Penang will not become a bankrupt state following the state’s accumulated savings, which are allegedly declining due to a budget deficit.
Chief Minister Chow Kon Yeow said that state reserves currently stand at RM1.82 billion instead of RM888 million as understood by many.
He explained that the amount of RM888 million only involved the Consolidated Revenue Account and did not take into account the Consolidated Trust Account amounting to RM933.68 million in 2020.
“I would like to give an explanation to correct this statement. When we took over the state government in 2008, the state’s accumulated savings amounted to RM847.45 million and had increased to RM1.97 billion in 2018.
“In 2019, the state government has succeeded in increasing the state’s accumulated savings to RM2.1 billion.
“However, this proud performance cannot be continued in 2020 because of the struggles and challenges of the Covid-19 pandemic,” he said at the state assembly’s winding-up session today.
In this regard, Chow (Padang Kota- DAP) said the state government has spent a large allocation to provide assistance to the affected groups under the Penang Lawan Covid-19 Special Assistance Package Phase 1, 2 and 2.1.
Apart from that, he said, the state government’s revenue has also decreased where only RM467.28 million was collected compared to the original estimate of RM519.16 million.
“These factors have caused the state’s accumulated savings to decline slightly from RM2.1 billion to RM1.82 billion this year, instead of RM888 million as stated.”
Penang MCA yesterday, slammed the state’s Budget 2022, which is allegedly unbalanced and can expose the state to bankruptcy in the future.
State MCA spokesman Tang Heap Seng claimed that Penang had RM1.07 billion in state reserves in 2018, but the amount is declining, and the state had only RM887.78 million in state reserves last year.
Last week, the Penang government tabled the state’s 2022 budget with a total allocation of RM935.22 million and an estimated deficit of RM449.8 million, making this its 11th year in deficit since 2011.
Meanwhile, Chow said Penang was a marginalized state in terms of allocations in the Budget 2022 by the federal government.
He said the state received the second lowest allocation in the country with an allocation of only RM0.9 billion.
“This grant does not commensurate with Penang’s contribution to the country’s gross domestic product. That is why I am asking for RM5 billion so that we can revitalize our economy.
“This grant can also help in reducing the state government’s deficit,” he said – The Vibes, December 2, 2021
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