The Malaysian Insight

PENANG will hopefully not have a problem with unspent expenditure in 2019, unlike last year as highlighted by the latest Auditor-General’s Report, Chief Minister Chow Kon Yeow said.

It was reported on Monday that the A-G’s Report 2017 Series 2 had found the expenditure performance of projects funded by the Penang government under its development plan for last year as “generally unsatisfactory”.

The report that was tabled in Parliament said the poor performance was because only RM301.38 million of the RM887.44 million allocation – 34% – was spent.

Chow said the issue was because a sum of money allocated to state investment arm Penang Development Corporation (PDC) as a loan for land acquisitions for new industrial land and infrastructure developments was not drawn.

“On paper, the money was not used. It was provided under the state Budget 2017 but not totally spent. So there was a surplus.

“It gave an impression that money was not properly used, but it was just not spent 100%.

“Maybe this problem will not arise next year because no loan is given to PDC under the state Budget 2019,” he told reporters at PDC’s Deepavali open house today.

Next year’s state budget is Chow’s first as chief minister. He took over the administration in May from his predecessor Lim Guan Eng, who is now finance minister.

Chow, who is also PDC chairman, said PDC had secured a bank loan for development use, so the state was not giving a loan to the corporation next year.

He also said if the state achieved another surplus next year, it would have to come from new revenues or savings on expenses.

“The auditor-general’s advice is not to transfer unspent money as a surplus. It should go straight into the state consolidated fund. We have to follow this,” he said.

Penang, since it was controlled by the DAP-led administration in 2008, has recorded surplus budgets annually. Last year’s surplus was RM51.16 million.

The state’s Budget 2019, which Chow tabled early last month, projected a RM395.69 million deficit, which was 47% lower than 2018’s.

Chow had said then that the lower deficit was because the state no longer gave loans to state statutory bodies. – December 6, 2018.