Penang Chief Minister Lim Guan Eng has raised alarm that the whopping RM13.8 billion supplementary budget tabled in Parliament last week is edging the nation deeper into debt.

In a statement today, he said that the figure, if added to the RM45.9 billion projected deficit in the 2012 budget will mean that Malaysia would arrive at its highest total deficit in its history.

lim guan eng interview 260512 04 Lim, ( right ) who is also Bagan MP, noted that this is of even more concern considering the much anticipated global slowdown, which may also affect Malaysia.

At RM59.7 billion, he said, Malaysia's deficit as of percent of gross domestic product (GDP) will grow to 6 percent, higher than the projected 4.7 percent.

"As of Quarter 1 of 2012, government debt stood at RM470 billion. If we include the expected deficit from the 2012 Budget, our government debt will easily increase to beyond RM500 billion by the end of the 2012.

"And this does not even include the worrying increase in the contingent liabilities that are not officially on the books," said Lim, who is a trained accountant.

The off-budget debts are those of which the government has acted as a guarantor, which at the end of 2011 stood at a mind-boggling RM110 billion.

Adding this to the official government debt, he said, would push debt to GDP ratio to an alarming 65 percent by the end of 2012 - a 10 percent jump from the statutory 55 percent debt of the GDP limit.

This despite Prime Minister Najib Abdul Razak's vow that government debt will not exceed the 55 percent of the GDP limit.

Questioning RM30mil branding unit

To make matters worse, Lim said, the supplementary budget is sought for questionable purposes, like the RM30 million for a National Branding Unit under the already "bloated" Prime Minister's Department.

"One wonders why Malaysia needs a branding ynit when there already existing ministries such as the Tourism Ministry and agencies such as Matrade which promote Malaysia and Malaysian companies within and outside the country," he said.

The DAP secretary-general also raised concern over the additional RM30 million allocated to the Election Commission which "cannot even do a proper job of cleaning up the electoral roll" and the RM1.5 million allocation for each BN MP.

"Since 1997, we have experienced 15 consecutive years of budget affairs. Our government debt has increased from RM89 billion to RM470 billion as at March 2012.

"Our government debt has increased fivefold since 1997 while our GDP has only increased by threefold.

"In contrast to BN's dismal financial performance, Pakatan Rakyat state governments have recorded surplus after surplus every year and even managed to reduce our debts sustainably," he said.