LCS Payments?

ENS El Fateh. Naval Group

SHAH ALAM: LCS payments? Updated with DE allocations for both ministries. Dewan Rakyat today December 20 2022) approved the Consolidated Fund (Expenditure On Account) Bill 2022 that provides for RM107.72 billion in civil service expenditure for a part of 2023. This was necessary as the proposed 2023 budget was not approved as the Parliament was dissolved prior to its approval. According to Bernama, Prime Minister Datuk Seri Anwar Ibrahim, who is also the Finance Minister, said this gave temporary Parliamentary approval for the government to spend a portion of the total estimated expenses during the months prior to the re-tabling and passing of the Supply Bill for 2023 (expected this February).

What is interesting is that Home Ministry got RM6.9 billion with a DE allocation of RM2.66 billion (the full proposed 2023 budget was RM18.3 billion; OE RM13.5 billion and DE RM4.5 billion) and Defence got RM5.71 billion and a DE of RM2.9 billion (proposed 2023 budget RM17.4 billion; OE RM11.4 billion and DE RM5.9 billion). It is likely the main allocations are for emoluments of personnel and other operational expenditures. But one wonder whether the DE allocation for defence include funds for the LCS, the payments for work already done and had not been paid since 2019. This is likely as the LCS project is set for resumption next year. As they say, no money, no talk. That said, some RM4 billion are already due to the LCS subcontractors, whether or not the project resumed.

From the Sun Daily:

KUALA LUMPUR: The Dewan Rakyat today passed the Consolidated Fund (Expenditure On Account) Bill 2022 that provides for RM107.72 billion in civil service expenditure for a part of 2023.

Prime Minister Datuk Seri Anwar Ibrahim, who is also the Finance Minister, said this gave temporary Parliamentary approval for the government to spend a portion of the total estimated expenses during the months prior to the retabling and passing of the Supply Bill for 2023.

“The estimated expenses under the bill, among others, include payments of emoluments for the civil servants, utilities, scholarships, social welfare aid as well as education and health services.

“In addition, ongoing development projects must continue and scheduled contract payments must be met,” he said when tabling the special allocation, or the Mini Budget, in the Dewan Rakyat today.

Anwar said the bill is in conformity with paragraph (a) of Article 102 of the Federal Constitution and similar bills were tabled previously, the last of which was on Dec 20, 1999.

According to the blue bill distributed by the Parliament, the largest sum would be allocated for the Treasury General Services amounting to RM28.12 billion followed by the Ministry of Education (RM24.97 billion) and the Ministry of Health (RM17.05 billion).

Other provisions include the Prime Minister’s Department (RM2.17 billion), Ministry of Home Affairs (RM6.90 billion), Ministry of Higher Education (RM5.85 billion), Ministry of Defence (RM5.71 billion), Ministry of Agriculture and Food Security (RM2.38 billion), Treasury (RM2.01 billion) and Ministry of Women, Family and Community Development (RM1.59 billion).

A sum of RM1.81 billion would be set aside for the Ministry of Rural and Regional Development, RM1.09 billion for Contribution to Statutory Funds, RM83.36 million for the Parliament of Malaysia, RM495.72 million for the Ministry of Communication and Digital, and RM235.75 million for the Public Service Department.

The Dewan Rakyat has also passed a provision of RM55.95 billion to be withdrawn from the Development Fund with respect to the financial year 2023 to meet the government’s urgent expenditure.

Additionally, the Dewan Rakyat has passed the motion to transfer RM35.04 billion, comprising the balance of the proceeds from the Malaysian Government Investment Issue (MGII) amounting to RM31.83 billion and from the Malaysian Islamic Treasury Bills amounting to RM3.21 billion for the year 2022, into the Development Fund in accordance with Section 3(1) of the Government Funding Act 1983 (Act 275).

The Dewan Rakyat has also passed another motion to transfer a total of RM16.20 billion in accordance with Section 3(1) Act 275 and Section 4(2) of the Temporary Measures for Government Funding (Coronavirus Disease 2019 (Covid-19) Act 2020 (Act 830).

The amount is the balance of proceeds of MGII for 2022 to be transferred into the Covid-19 Fund.

Both motions were tabled by Deputy Finance Minister Datuk Seri Ahmad Maslan.

“Both transfers are intended to fund parts of the development expenditure provisions for 2022 as passed by the Parliament during the tabling of Budget 2022 last year.

“The Development Fund is a government trust fund established in accordance with the Development Funds Act 1966 to make provisions for development projects,” he said.

Meanwhile, the transfer of proceeds into the Covid-19 Fund is intended to provide for the required expenditure (Covid-19 Fund) for the year 2022.

The session was adjourned to a date to be announced later.-Bernama


— Malaysian Defence

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10 Comments

  1. It says a lot on where our threat perceptions and concerns are when the Home Ministry is allocated a larger budget than the Defence Ministry.

  2. I believe mostly will go towards salaries, emoluments, bonuses, expenditures, pensions, and other provisions. The budget size would depend on the departmental headcounts under their purview.

    “Home Ministry is allocated a larger budget than the Defence Ministry”
    That’s because Home has a far larger headcount compared to Defence.

  3. The question is how much more will be required (beyond the RM9b already spent) to complete LCS 1? Answer – no one knows. BNS once said they can complete LCS 1 and LCS 2 for RM3b and LCS 3 through 6 for another RM3b. It was proposed when the amount disbursed was RM6b. Now, having spent RM9b, LCS 1 and LCS 2 still not completed. So how should the LCS be budgeted? At the same time RMN puts in a multi-billion request for 8 ships under the LMS Batch 2 program.

  4. @ZekMR
    “That is what i mean, not being politicised for the time being”
    Things do not get politicised unless it benefits the politicians, ie they politicised LCS running to GE15 cuz it works to their favour but now they are in Government politicising it will be detrimental to them. This is why one shouldnt trust politician words.

    @kel
    “beyond the RM9b already spent”
    As mentioned, and officially confirmed, only RM 6.1Bil was spent and balance budget of RM 9Bil was frozen now pending for the restart. How should it be budgeted? As there is still balance remaining, they could unfreeze and use that provision to restart but it will take a supplementary budget (what I suspected Najib’s Govt had originally planned for) to cater for the remainder of the cost.

  5. Joe, as mentioned, RM6 bil spent. RM9 bil already billed. That is, in total vendors have billed the government RM9 bil. That RM3b is for work already done, not to complete the ships. There is no more reserve. Just because it hasnt been disbursed doesnt mean it hasn’t been spent. Can you guesstimate the additional funding required to finish the 6 ships?

  6. ”That’s because Home has a far larger headcount compared to Defence.”

    More pertinently that is because the government sees internal or non state thrats as more serious rather than external ones…… This has been the case since the 1970’s and is one reason we have what was formerly the Police Field Force. You will also note that under the Home Ministry’s budget various stuff gets funded but doesn’t get widely publicised.

  7. @Kel
    You mentioning it over and over doesn’t make it fact. Please refer to official figures. Nuff said.

    “government sees internal or non state thrats as more serious rather than external ones”
    Well isn’t that quite normal for any nation that isn’t facing some immediate external threat or at war somewhere? Police & law enforcement forces will always outnumber the armed forces during peacetime, this is true even for Ukraine prior to the invasion, except in Malaysia we consider them as Federal civil servants and thus under Federal Govt ambit. With more mouths to feed, clothe, and house, it is naturally the lawmen under Home gets the bigger cake vs armymen under Menhan. Regardless tho, both have a long list that remains unfulfilled.

  8. “government sees internal or non state thrats as more serious rather than external ones”

    Then it is about time to really ramp up the acquisition of OPVs for the MMEA.

  9. Wong – “Then it is about time to really ramp up the acquisition of OPVs for the MMEA”

    I agree and that’s what certain other
    posters who have harped about but it’s not only about hardware for the MMEA but also share infrastructure and sustained funding. It isn’t just the hardware as some overlook.

    Another issue is that when I say internal and external threats I meant religious and political extremism and terrorism; that’s what really worries the government and is why the Home Ministry is well funded.

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