Shafie said when he took over as chief minister in 2018, there was only about RM400 million in the sinking fund set up for the repayment of the RM1 billion federal bond upon its maturity.
He said the bond repayment was in excess of RM1 billion since it included interest payments.
“The RM400 million was barely 40% of what was needed to repay the bond principal, and that was without counting interest.
“Masidi’s claim that the Barisan Nasional Sabah government had already set aside RM1 billion is false. By 2018, the bulk of the repayment, which was roughly RM600 million, still had to be found within months.
“Through prudent financial management, cost controls and the reallocation of resources, Warisan boosted the sinking fund from RM400 million to RM1 billion in a year. This ensured that the bond was fully repaid on schedule,” he said in a statement.
On Sunday, Masidi accused Shafie of claiming credit for the debt repayment when it was thanks to the financial planning of the Musa Aman administration.
The Gabungan Rakyat Sabah secretary-general said the federal bond was issued in December 2014 while the state government was required to allocate RM200 million for the sinking fund each year for five years, until 2019.
The Sabah finance minister said that by the time the Warisan administration took office in 2018, most of the funds needed for the repayment had already been secured.
‘What was RM1bil federal bond spent on?’
Shafie urged Masidi to explain what the RM1 billion bond was used for, claiming he was informed that half of it was spent on another state.
He pointed out that Masidi was a member of Musa’s state Cabinet.
“If true, this means that half of the debt burden Sabahans carried for five years did nothing to improve infrastructure, services or development here in Sabah.”
He also contended that the BN administration was not very prudent with its finances, citing the amount in the sinking fund when he took over as chief minister.
“The repayment didn’t happen automatically. It was the result of tough decisions, strict financial discipline, and managing the state responsibly despite limited time and financial pressure,” he said.