Malaysia Budget 2012. Where are we really Heading to?

So here it comes again Budget 2012 this time. As much as a company will declare their bonus to their staffs, so goes to the government to declare the bonus to the government servants and further allocations in various areas. Original Newsfeed from here. PM budget speech is available here.  As much as I’m not hardcore into politics but often I read up reviews from DAP such as LimKitSiang (though I haven’t touched it) but I’ve read Tony Pua’s book on the major issues since the last GE.

As for me the whole impression of this Budget 2012 seems to again very much on a pre-GE setting, having much aligning to the theme for 2012 For the Rakyat or whatever our 1 Malaysia quotes “Rakyat didahalukan”. We must really be aware that Malaysia Economy is in deep hot water state now, as much as transparency is being reported to be the utmost priority the BN government will promise, transparency international and also third party media streams clearly said other wise.

What we could realize from the brief review of the budget here is that few main issues in the country hasn’t being highlighted, whatever being announced in the budget more like seem to buy the rakyat hearts by giving subsidies and allowance to cover the rising cost but not really a concrete plan for a sustainable economy framework for the nation. Deprivatizing highway tolls, Oil matters, etc. And we must know that if it’s not Petronas then probably we are nowhere because our country is on oil addiction, thanks to the Petronas Tax that we only have the budget to do such thing!

So that’s my brief opinion.. wouldn’t go into one or two because really everything seems to be short term.

KUALA LUMPUR: Highlights of Budget 2012 tabled by Prime Minister Datuk Seri Najib Tun Razak in Parliament Friday.

– Last year our FDI growth was the strongest in Asia and in the first 6 months of this year have already reached RM21.2bil.

– In 2012, private investment is forecast to climb 15.9%, supported by foreign and domestic investment.

– GDP in the first 6 months of 2011 was 4.4%, driven by strong domestic consumption.

– In 2011, the economy is forecast to grow by 5-5.5%

– Private and public investment are forecast to increase by 15.9% and 7%, supported by foreign investment, the ETP and 10MP

– In 2012, the service sector is expected to grow 6.5%, the construction sector 7% and GDP is forecast to be between 5 and 6%

– Budget 2012 allocates RM232.8bil for Government plans, including RM181.6bil for management and RM51.2bil for development

– RM29.8bil has been allocated for investment in infrastructure, industrial and rural development

– RM13.6bil has been allocated for the social sector, including education and training, welfare, housing and community development

– Total revenue for 2012 is forecast to increase 1.9% to RM186.9bil and the deficit to decrease to 4.7% of GDP from 5.4% in 2011

– The theme for Budget 2012 is “National Transformation Policy: Welfare for the Rakyat, Well-Being of the Nation”

– We will focus on accelerating investment and further liberalise 17 services sub-sectors, in places enabling 100% foreign equity.

– RP2 will be implemented in 2012, and it will be allocated RM98.4bil, to be split evenly between 2012 & 2013

– RP2 main projects will include the East Coast Highway from Jabor to T’ganu and road upgrades from Kota Marudu to Ranau

– RM18bil of the RM20bil PPP Facilitation Fund will be used for high impact projects, with RM2 billion for Bumiputera entrepreneurs

– In 2012, the Government will allocate RM978mil to accelerate the development in five regional corridors

– The Treasury Management Centre will be established and offer incentives to develop M’sia as a competitive financial centre

– We will develop the Kuala Lumpur International Financial District, with incentives including income tax exemptions for firms

– We will develop the Kuala Lumpur International Financial District, with incentives including income tax exemptions for firms

– Income tax exemptions for non-ringgit sukuk issuance and transactions will be extended for another 3 years

– To promote the development of Exchange Traded Funds products I-VCAP will provide RM200mil for Shariah-compliant ETFs

– Felda GVH will be listed on Bursa Malaysia by mid-2012 to raise funds for the company to become a global conglomerate. Felda settlers are expected to receive a windfall, and the amount will be announced before listing

– A RM2bil shariah-compliant SME Financing Fund managed by selected Islamic banks will be established in 2012

– A RM100mil SME Revitalisation Fund offering loans up to a maximum of RM1mil for entrepreneurs will be available from Jan 2012

– Full exemption of import duty and excise duty on hybrid cars and electric cars will continue to be given until 2013

– To promote tourism, the Langkawi Five Year Tourism Development Master Plan will be launched with an allocation of RM420mil

– The real property gains tax will be reviewed so it doesn’t jeopardise the ability of low- and middle-income groups to buy homes

– The Malaysia Healthcare Travel Council will be privatised to promote and develop Malaysia as a healthcare destination

– Budget focuses on developing human capital, creativity and innovation and 2012 will be the National Innovation Movement year

– The Govt has allocated RM100mil promote innovation including the 1Malaysia Award (C1PTA) for innovative student inventions

– To enable SMEs to commercialise research products a Commercialisation Innovation Fund totalling RM500mil will be established

– RM50.2bil will be allocated to the education sector so that it can continue to develop talented, creative and innovative people

– RM1bil will be provided through a special fund for the construction, improvement and maintenance of schools

– We will abolish payments for primary and secondary education, making these free for the first time in our history

– Private schools registered with the Education Ministry will be given incentives including an Investment Tax Allowance

– The Govt will give tax exemption for contributions to educational institutions and all places of worship

– To encourage private sector human capital development incentives including a double deduction on scholarships will be offered

– Budget 2012 introduces a Rural Transformation Programme, so that rural areas can attract private investment and create employment

– RM5bil to develop rural infrastructure, including RM1.8bil to the Rural Road Programme & Village-Link Road Project

– RM500mil to expand the programme to supply clean water to the rural community in Sabah

– RM400mil to upgrade the water supply infrastructure in selected Felda areas

– To provide greater access to bank services for the rural population, Bank Simpanan Nasional will appoint agents in rural areas

– RM90mil for the Orang Asli for basic necessities, including the expansion of the clean water supply project. For the Orang Asli affected by the landslides at Sungai Ruil, RM20mil is provided for their relocation to new homes

– 600,000 Govt pensioners will benefit from an additional annual pension increment of 2%

– Civil servants get pay rise between RM80 to RM320

– Govt will extend the compulsory retirement age from 58 to 60 years old to optimise civil servants’ contribution

– Civil servants will be offered tuition fee assistance for part-time studies, including 5,000 masters and 500 doctoral scholarships

– A special programme will be introduced for 175,000 army personnel who are not eligible for pensions

– RM3,000 will be given to ex-members of the special constable and auxiliary police as well as widows and widowers

– The Govt is mindful of the plight of the rakyat due to rising food prices and will take measures to address this

– The National Agro-Food Policy 2011-2020 will be launched and RM1.1bil allocated for the development of the agriculture sector

– In the spirit of “People First,” all subsidies, incentives and assistance totalling RM33.2bil will be continued

– 500,000 will benefit from KAR1SMA, which provides assistance to poor senior citizens and children and disabled people

– My First Home Scheme will be expanded to increase the limit of house prices from a maximum of RM220,000 to RM400,000

– Govt will identify areas in the vicinity of MRT, LRT and other public transport to be developed by PR1MA

– Govt will continue to implement the Program Perumahan Rakyat by building 75,000 units of affordable houses

– Govt will establish the Special Housing Fund for Fishermen to build and refurbish houses

– Healthcare will be allocated RM15bil operating expenditure and RM1.8bil development expenditure

– Hospitals will be upgraded and constructed as well 81 rural health clinics upgraded and 50 new 1Malaysia clinics launched

– Hospital Kuala Lumpur – the oldest in Malaysia – will be upgraded to be the country’s premier hospital

– Skim Amanah Rakyat (SARA) 1Malaysia will benefit 100,000 households with income below RM3,000 per month

– To assist taxi owners facing increased operating costs, measures will be introduced including tax exemptions on taxi purchases

– The National Legal Aid Foundation will ensure that every individual who is charged in court will be given free legal aid

– To assist the homeless, the Govt established a social assistance centre known as Anjung Singgah

– A training allocation of RM10mil will be provided for women to develop leadership and managerial skills

– To prevent cervical cancer, the Government will provide free Human Papilloma Virus immunisation nationwide

– MyCreative Venture Capital with an initial fund of RM200mil to be established

– RM15mil will be allocated to build 150 futsal courts to achieve the “One Court for One Mukim” target

– To ensure the welfare of retirees measures including a tax relief on Private Retirement Schemes contributions are introduced

– Senior citizens aged 60 years & above will be exempted from outpatient registration fees in Govt hospitals & health clinics

– One-off assistance of RM500 to households with a monthly income of RM3,000 and below will be provided

– For those in private sector earning RM5000 and below, employers’ EPF contribution will increase from 12% to 13%

– Book voucher worth RM200 will be given to Malaysian students in all private and public institutions of higher learning

– Civil servants will be given an additional bonus of half-month salary and pensioners RM500