Koh defends Jala on differences in subsidy bill

Treasury officials used incomplete data in claiming that last year’s bill for subsidies only came up to RM18.6 billion.

Minister in the Prime Minister’s Department Koh Tsu Koon (right) confirmed that the bill was RM74 billion, as cited last week by Idris Jala, the head of the government's Performance Management and Delivery Unit (Pemandu).

Yesterday, The Malaysian Insider reported that the Treasury provided a different figure to BN Backbenchers.

At a briefing, the BN parliamentarians were told that the government had spent only RM18.6 billion on subsidies last year.

Koh explained that the discrepancy in the figure is due to differences in the definition and classification of expenditure and their sources.

"The Treasury's figures refer to direct subsidies involving only the Treasury, while those of Pemandu include all indirect subsidies and from all public sources," he told reporters at the Parliament lobby this morning.

Three percent growth

Koh cited the Treasury's exclusion of the RM12 billion petroleum subsidy by Petronas as it considered the expenditure as not deriving from the government.

"Pemandu's figures included the RM12 billion because Petronas is wholly-owned by the government and Petronas money is also public money.

"If not totally used as petroleum subsidy, part, if not all, of the RM12 billion could be used directly for the benefit of the people," he was reported saying by Bernama.

He also said the Treasury figures do not include the total cost of education, which was taken into account by Pemandu.

He cited the example of how the Treasury may have included scholarships as subsidy but not the total cost of public tertiary education funded by the government.

Koh said he had briefed Prime Minister Najib Abdul Razak and Second Finance Minister Ahmad Husni Mohamad Hanadzlah last night to clarify the discrepancies.

Asked about Idris' prognosis that the country would be bankrupt by 2019 if subsidies are not drastically cut, Koh said he believes the media "may have missed out important points".

Subsidies have been growing at 12 percent per year, while the real econnomic growth is only three percent per year, said Koh.

"By 2019, the total subsidy quantum will exceed GDP.

"But as the PM said, we won't allow it to happen. We want to drive economic growth beyond three percent. We are trying to reduce subsidies without hurting the people," he added.