Thursday October 8, 2009
DAP draws up shadow national Budget
PETALING JAYA: The DAP has come up with its own alternative budget, one that focuses on fiscal decentralisation.
According to the budget, entitled Democratising Malaysia’s Economy, the decentralisation will empower each state in the country with greater governing control of financial power and decision-making.
DAP national publicity secretary Tony Pua, a key figure behind the budget, said the objective in democratising the economy was for public funds and expenditure to be spent more effectively, according to the needs of the people.
“State expenditure as a proportion of overall budget has dropped from 25% in 1990 to only less than 9% in 2007. This means the Federal Government is getting more money but the proportion that goes to the states has declined tremendously,” he said during the launch of DAP’s alternative budget here yesterday.
Citing the example of Penang, Pua said the state contributed RM2.5bil in income taxes to the Government and only received RM127mil in federal grants.
He also gave the example of a highly-centralised Transport Ministry that would not be able to make informed and effective public transportation policies for each township and city in the country.
The budget looked into improving the transportation system by devolving powers to city and state transport authorities, enabling the respective authority to take care of its own infrastructure with a given monetary allocation.
DAP proposed a tax-revenue sharing agreements between the Government and states, for a stronger link between a state’s performance and its revenue share.
This would be done through a formula where 20% of individual and corporate income taxes collected in a state becomes the state’s entitlement.
Under the budget, DAP also proposed a fund of RM400mil to reinstate local government elections.
Pua said the budget would be presented to Pakatan Rakyat MPs on Oct 19.
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