Prime Minister Najib Abdul Razak today said electricity tariff will not be increased this year as part of the restructuring of Budget 2015.

He also revised the country's projected gross domestic product growth downwards from between five to six percent to 4.5 to 5.5 percent while the country's deficit target of 3.0 percent was revised to 3.2 percent.

The revised budget is in response to the country's falling income due to a crash in global oil price and the weakening ringgit.

While the weakening ringgit may weigh down on debt and imports, its upside is cheaper exports.

Acknowledging this, Najib, who is also finance minister, announced several measures to spur exports and encourage local businesses with the moratorium on electricity tariff being among them.

However, the measure may not sit well with the opposition which has pushed for tariff cut as lower fuel price has reduced the cost to produce electricity.

He also announced steps to spur local consumption including extending shopping mall hours and the frequency of mega sales.

Najib also assured the country's development expenditure of RM48.5 billion would remain unchanged and all mega projects would be on track.

The mega projects that would go ahead include MRT Line 2, LRT 3, KL-Singapore High Speed Rail and Pan-Borneo Highway.

Austerity measures, he said, would be on the government’s side as operational expenditure would be slashed by RM5.5 billion.

Najib also announced several allocations to fund reconstruction efforts in the East Coast which were devastated by massive floods with damage estimated at RM2.9 billion.

Below are the salient points of the revised budget:

Cuts and increasing revenue
  • Save RM400mil by deferring National Service Training Programme
     
  • Save RM1.6bil by cutting overseas travel, events and functions and use of professional services
     
  • Save RM3.2bil by reviewing transfers and grants to statutory bodies, GLCs and government trust funds
     
  • Save RM 300mil by rescheduling purchase of non-critical assets, equipment, software and vehicles
     
  • Raise RM400mil from additional dividend from GLC, GILC, other government entities
     
  • Raise RM1bil by encouraging more companies to register for Goods and Services Tax
Improve domestic consumption
  • Extend shopping hours
  • Increase frequency of mega sales
     
  • Intensify "Buy Malaysia" products campaign
     
  • Promote domestic tourism through competitive air fares
     
  • Priority for local G1 (class F), G2 (class E), G3 (class D) contractors registered with CIDB for flood reconstruction works
     
  • Encourage private sector to leverage benefits from Asean Economic Community
Spurring exports
  • Shift from foreign to local sources for procurement of goods and services
     
  • Help connect exporters with new clients
     
  • Intensify export promotion programmes in 46 countries
     
  • Provide funding for exporters
     
  • Improve road and railway connectivity to Port Klang
     
  • Upgrade Padang Besar railway terminal
     
  • Improve operational efficiency of import and export processes
     
  • Establish a hub and spoke system for air transport
     
  • Waiver of visa fee for tourists from, among others, China
     
  • Review levy on foreign workers
Spurring private investment
  • Postpone electricity tariff hike
     
  • Postpone gas price hike for industrial sector
     
  • Encourage GLCs and GLICs to invest domestically
     
  • Reserve 30 percent of government and GLC good and services annual procurement budget for local SME
     
  • Increase local goods and services in government procurement
     
  • RM5bil Service Sector Guarantee Scheme for SME, RM5mil maximum financing with 70 percent guarantee
Flood reconstruction   
  • RM500 for each household affected by floods
     
  • RM5,000 for next-of-kin who lost family members in floods
     
  • RM500mil for rehabilitation works and welfare programmes
     
  • RM800mil for repair and reconstruction of basic infrastructure
     
  • RM 893mil for flood mitigation projects
     
  • RM200 million soft loans for SME and microenterprises affected by floods via Tekun and AIM
     
  • Bank Negara to establish RM500mil Special Relief Facility for SME at financing rate of 2.25 percent
     
  • Bank Rakyat to offer personal loan up to RM50,000 at financing rate of 3.9 percent
     
  • RM500mil to be provided by financial institutions with 70 percent guarantee under Flood Relief Loan Guarantee Scheme
     
  • SME exempted levy payment to Human Resources Developement Fund for six months
     
  • BSN, Agrobank, SME Bank, Tekum, AIM to defer loan repayment up to six months
     
  • Construct 8 feet stilt houses for those who have land and homes were damaged by floods
     
  • Hand over 1,000 units of completed low cost houses in Gua Musang

Text of the prime minister's speech