Dr Mohd Irwan (centre) presents a mock cheque to representative from Universiti Malaya Dr Sayuti Ab Karim (left) during the University Start-Up Conference Malaysia 2015 programme. — Bernama photo
KUALA LUMPUR: The government is ready to implement more stringent cost-cutting measures if the global crude oil prices continue to slide, said Treasury secretary-general Tan Sri Dr Mohd Irwan Siregar Abdullah.
He however gave the assurance that any austerity measures to be announced by the government would not affect public service delivery and the nation’s economic growth.
“We already have the follow-up measures (if the oil prices continue to fall), but at present, we opine that those measures need not be implemented,” he told reporters on the sidelines of the University Start-Up Conference Malaysia 2015 here, yesterday.
On expectations by some analysts that the global crude oil price would plunge to US$14 per barrel, Mohd Irwan Serigar said these were their own projections.
“We are taking a proactive step by putting the price expectation at the U$55 per barrel level, which is quite positive in terms of future expectation.
“But if the price falls further, then the government would implement the new (saving) measures.
“We are monitoring (crude oil price) now and look at its development,” he said.
Mohd Irwan Serigar also denied claims that Malaysia was too dependent on oil and gas revenue.
From studies and close examination carried out yesterday, he said the country’s dependency percentage from oil and related products was only 21 per cent out of the the overall national income.
“We have diversified our economy to the manufacturing and services sectors which encompass all aspects of the country’s economic growth.
“In terms of crude oil production, (currently) we still have surplus, but if we take into account refined products or petroleum products, then we are in a deficit of about RM1.2 billion,” he said.
On the reduction of RM5.5 billion in operating expenditure, Mohd Irwan Serigar said the reduction were for non-critical expenditure, whereby RM2 billion was from supply and services.
This covers the national service training programme which has been deferred for one year for review, overseas travel, and events and functions.
He said saving from these programmes would not affect the economy and government service delivery.
Mohd Irwan Serigar also touched on the purchase of non-critical assets, such as vehicles and office equipment which can still be used, which are deferred for one or two years.
He said the deferment of these asset purchases would save government expenditure of about RM300 million this year.
“There are also government entities that have their own funds generated by their own investment activities. Hence, the government will reduce the allocation to them,” he said. — Bernama