According to Treasury Secretary-General Mohd Irwan Serigar Abdullah, all Ministries have been informed to cut back in a bid to minimise all forms of wastage. Even the Finance Ministry (MoF) is not excluded from cost-cutting measures.

“All our (MoF) senior officers have been told that they will no longer travel in first class coaches. They have to either travel in business or economy class.

“Even our meetings now, we only serve water. Look at today’s event, although it was held from 12pm to 2pm, we are not serving any food, just water.”

Mohd Irwan was speaking at a forum held to explain the changes within Budget 2016, as was announced by Prime Minister Najib Razak this afternoon.

The budget centred around increasing consumer purchasing power saw, amongst others, a 3% cut of the compulsory Employees Provident Fund (EPF) contribution.

An officer from the EPF present at the forum said although all employees will be automatically subjected to the reduction in their monthly EPF contributions, they were free to opt out of the programme if they so wished.

Governor of Bank Negara Malaysia (BNM), Dr Zeti Akhtar Aziz, said while the country’s economy was still in a stable condition, with inflation expected to float around 2.5 to 3.5 per cent for the first quarter of 2016, the key driver to maintaining, if not improving, this stability was to increase domestic demand.

This, she said, was the reason why the EPF cut was a necessary short term measure though it is expected to be in force only until 2017.

With the cut, coupled with other measures which would see the public having more cash in hand, purchasing power as well as consumption demand would improve, resulting in a more sustainable economy.

“We (BNM) strongly support the cut. In fact, 3 per cent is very modest. It could have been higher,” said Zeti.