While he acknowledged the World Bank’s concerns about Malaysia’s fiscal sustainability and agreed there was a need for the country to increase its revenue base, Rafizi stressed the government is doing everything possible to optimise spending.
“We owe it to the public to show that we’ve done all we can to make sure every ringgit is spent wisely,” he told reporters after the launch of the World Bank’s Malaysia Economic Monitor report here.
“We’ve been working on rationalising government expenditure and focusing on areas like blanket subsidies and development spending.
“People often question how much it costs to build a school or a hospital. We’re going through that process to ensure we’re getting the best value for money.”
When asked if Budget 2025 would see cuts in development spending, Rafizi said it was up to the Prime Minister Anwar Ibrahim, who is also the finance minister, to announce the details on Friday.
“You can have an ever-increasing development budget, but if you don’t optimise costs, the public won’t see the benefits.
“If we can build a school for RM30 million, we need to make sure it doesn’t end up costing RM50 or RM60 million.”
Rafizi also said simply spending more on development does not always translate to economic growth, particularly in key areas like education and healthcare.
He said the government is working to ensure its spending is benchmarked against market costs to prevent waste.
On the issue of fuel subsidies, Rafizi said recent economic growth and the strengthening of the ringgit have provided the government with some fiscal relief.
“We’ve had higher economic growth and the stronger ringgit has reduced pressure on our subsidy bills, but balancing fiscal targets, inflation, growth and cost of living pressures is key,” he said when asked whether Putrajaya will implement targeted RON95 petrol subsidies this year.
“My view is that as long as the government has options to navigate, we’ll be able to balance competing priorities better — and we will move closer to our fiscal consolidation target.
“So that’s basically a politician saying nothing.”