Citing a recent report by the Institute of Strategic and International Studies (Isis), he said the government’s fiscal injections in the 2021 budget and stimulus packages were the second smallest in Southeast Asia, although its overall size looked big.
Shahril said Putrajaya should also consider raising its debt ceiling or issuing bonds for operational expenditures, adding that the people’s economic struggles must be prioritised.
He said government debt and deficits were not something to be afraid of, compared with the rising personal debts.
“Sometimes, increasing the government’s debt can reduce the people’s debt, if done in the right way. For some reason, our policymaking institutions are still in conventional mode and are scared of debts and deficits.
“Other countries’ deficits have gone far higher than Malaysia’s to help their economy,” he said in a Facebook post.
Shahril said as long as the government held on to the idea that a low deficit and debt level was a good achievement, it would have its hands tied in helping the economy recover.
Citing the issue of students needing devices for online lessons, he said the main issue was whether Putrajaya was ready to spend and, if needed, to raise its deficit.
“The emergency gives wider powers to the government compared to normal circumstances. This includes the ability to bypass the parliamentary process.
“If such temporary powers are already available, and if the rationale of the emergency is Covid-19, then these powers should be used as best as possible for the people’s welfare,” he said.
Shahril warned that more challenges would crop up between now and August that would require government action beyond what was approved in the budget, including issues such as unemployment and young adults’ income.
“In managing the government’s finances for 2021, the people’s economic challenges must be prioritised, not the target of low deficit that is too restrictive and irrelevant at this juncture.
“The government’s debts can be managed. The pain of the people’s debts is what brings disaster.”