PETALING JAYA: With a budget of RM232.2 billion for 2012, the Government has allocated RM13.714 billion for defence, a reduction of some RM100 million compared to the RM13.823 billion which was spent in 2011.
To read the full planned 2012 expenditure, go Here
Although exact procurement plans were not mentioned, this was the first time that a more detailed expenditure, estimated or actual, was released. Such detailed expenditure had been published before but not in the planned budget document but in the Ministry’s’ annual report.
From the RM13.7 billion, some RM10.945 billion is for the management expenditure(salary, operations, logistics) and RM2.7 billion is for development costs(procurement). The administration allocation for 2012 is an increase of some RM400 million compared to last year while development see a reduction of around RM400 million.
Can we assume the RM400 million slashed for development had gone to pay for the increase in the soldiers salary as there is an increase of RM400 million for emolument cost in 2012?
It is interesting to note that for the development allocation, funds for asset allocation was reduced to RM2.6 billion in 2012 compared to RM3.292 billion last year while services and supply is set to increase in 2012 to RM309 million compared to some RM281 million last year.
Apart from that the operation allocation to all the services including the Joint Command for next year have been reduced although the number of personnel remained constant.
Another interesting number one need to see is the huge deficit in planned expenditure compared to the cost of the development projects. For example the Army projects (asset and construction) is RM8.18 billion while the planned expenditure for 2012-2013 is only RM1.44 billion. Its the same with the RMN, RM10.3 billion (cost of the project) while the allocation for next two years is only RM4.4 billion while for the RMAF its RM5.03 bilion and RM2.52 billion.
I guess they need to fund those deficit until the next Malaysian Plan to ensure the planned procurements can go through!
Based on the document, I am assuming that for the 10th Malaysian Plan the Armed Forces wish list cost RM24.748 billion. And for the next two years only RM8.837 billion is being planned to be spend on wish list. This year its RM2.768 billion (last year it was RM3.232 billion) so technically for next year budget the allocation should be around another RM2.8 billion to ensure that the planned projects will go ahead on time.
That said, they also need another RM15 billion or so to ensure that all projects planned under RMK10 can be completed within the next four years or otherwise, we may end up having something that was planned in 2010, being put into service in 2020 or further down road. Will Windows 7 still be the OS by that time?
By the way, the Home Ministry gets some RM10.7 billion. No figures for MMEA though.
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