The recalibration of Budget 2016 to reflect the current economic climate will see “a minor cut” in the operating expenditure and shelving of non-priority development projects, Treasury secretary-general Mohd Irwan Serigar Abdullah said.

“There will be no salary cut for government servants. We want to make sure service delivery remains intact. So, we do not compromise on service delivery,” he said in reference to the proposed reduction in operating expenditure.

Mohd Irwan spoke at a press conference after opening the RM23.8 million second phase of the swimming pool and hostel of the Labuan International School last night.

Prime Minister and Finance Minister Najib Abdul Razak is scheduled to present a recalibrated Budget 2016 on Jan 28.

Mohd Irwan said that as far as development expenditure was concerned, non-priority projects like purchase or transfer of land could be delayed.

Priority projects will go ahead

However, priority projects such as the Mass Rapid Transit (MRT), Kuala Lumpur-Singapore High Speed Rail and the Pan-Borneo Highway would go ahead as planned as these projects would spur economic growth and benefit the people in the long run.

“We are not going to cut even a single sen (from these allocations) and these projects will go ahead as scheduled.

“For the Pan-Borneo Highway project, the federal government has discussed with the state government of Sabah to select capable and qualified Sabahan contractors to construct the project on the Sabah side and local contractors in Sarawak to construct the Sarawak portion,” Mohd Irwan said, adding that in Sabah, the link would be stretched to Tawau.

“This will bring benefit to Sabah and Sarawak, with new cities and towns established. People living along the highways can start business. It will create more employment and improve people’s income. It will spur economic growth in the two states,” he said.

Mohd Irwan said projects with a high multiplier impact on the economy would not be halted as the government was looking at pro-growth or sustaining growth to ensure that more income could be generated.

He did not rule out the possibility of projects listed under the 11th Malaysia Plan affected by the recalibration of the budget being implemented eventually.

“If the oil price goes up, it is a bonus. So, whatever we have projected under the 11th Malaysia Plan, we may rethink to implement.

“The rakyat-centric projects with high contribution to the people’s happiness and well-being will certainly be given priority for implementation,” he said.

“However, if the oil price goes down (further), the government will need to ‘tighten its belt’ again,” Mohd Irwan added.

- Bernama