The Hope Fund has managed to collect more than RM7 million in less than 24 hours after its launch, revealed Finance Minister Lim Guan Eng. “This is truly a remarkable feat,” said Finance Minister Lim Guan Eng in a media release announcing the tally of donations so far. He reaffirmed the government’s commitment to “being transparent with every sen received”, adding that the amount collected will be updated daily on the finance ministry’s website and on its social media platforms.
“Therefore, the amount collected will be updated daily on the Ministry of Finance’s website and its social media platforms. For tax deduction purposes, Malaysians who donated to this fund are also advised to keep their receipt of the transaction as stated under Subsection 44 (6) of the Income Tax Act 1967,” he told a press conference in Putrajaya this afternoon. Finance Minister Mr Lim also said the finance ministry is “humbled by the magnanimity of Malaysians”, highlighting the efforts of young activist and law graduate Shazarina Bakti, who initiated a similar crowdfunding initiative online towards settling the country’s debt, a week before the “Hope Fund” was launched. Her effort has managed to raise RM13,476.57 thus far. That provided the inspiration for the government to set up its Hope Fund a week later.
“Malaysians have taken their patriotism to a greater height by willing to part with their allowances and spare cash to help rebuild this nation we all love. Malaysians, especially the likes of Shazarina, have continued to take their role in nation building seriously, and have not shown any signs of slowing down after the May 9 victory at the ballot boxes. It is precisely this spirit of hope and unity which will also fuel the Pakatan Harapan government in moving forward to fulfill all of its manifesto pledges for the people,” he added.
Yesterday, Prime Minister Dr Mahathir Mohamad announced the setting up of the “Hope Fund” after his administration accused the previous government of raking up a national debt and liabilities of RM1 trillion.
Prime Minister Mahathir Mohamad has made it a priority to cut Malaysia’s debts and liabilities — estimated at 1 trillion ringgit or 80 per cent of GDP — after taking into account Government guarantees and other payments. The newly formed Government has blamed economic mismanagement and corruption under former scandal-tainted leader Najib Razak and the long-ruling coalition Barisan Nasional that was ousted by a surprise defeat in the recent May 9 national election.
The country’s mega projects by the previous ruling party , along with the 1Malaysia Development Bhd (1MDB) scandal, have been cited as one of the main contributors to its staggering RM1 trillion debt. Prime Minister Dr Mahathir said the overall debt figure was higher than what was disclosed under the previous administration because the state had given credit guarantees to companies such as 1MDB. Malaysians have since rallied to set up a fundraising campaign towards reducing the nation’s debt. In response to the initiative, Dr Mahathir said the government, via the Ministry of Finance (MoF), will establish a special trust fund called Malaysia Hope Fund (Tabung Harapan Malaysia) to collect donations to help the new Government repay its hefty national debt. There are many Malaysians who were willing to donate to the Government when they found out how bad the country financial situation is currently.
“Due to the fiscal position of the country, many of the rakyat have come out to declare their willingness to donate to the government. We welcome their patriotic spirit and we thank them for their determination. This fund will ensure that the donations will reach the responsible authorities,” Dr Mahathir said. In a separate statement by the Ministry of Finance, Minister Lim Guan Eng said that the Malaysia Hope Fund would provide a systematic and transparent platform to manage all public donations. The ministry provided the name of a local bank and an account number for contributions which it said must be made in cash denominated in the local currency. All contributions shall be deposited into Malayan Banking Bhd, account number 5660 1062 6452. “Due to the recent economic development and the growing concern among the rakyat [people] on the country’s current debt position, there are signs of awareness from the rakyat to lend their support to the Government,” the finance ministry said in a statement.
The move is unusual for a government but it comes as a response to a crowdfunding campaign started recently by a Malaysian to help settle the staggering Government debt. The election victory by Dr Mahathir’s alliance inspired patriotic sentiment among many citizens who have expressed pride on social media about being part of a new Malaysia that is free from graft and race politics. Besides that, Dr Mahathir also announced the reintroduction of the Sales and Services Tax (SST) effective September 2018. The SST will replace the zero-rated Goods and Services Tax that will take place beginning tomorrow, to make up for the shortfall in government revenue.
The PM said retail fuel prices for diesel and RON95 will remain at their respective current rates of RM2.18 and RM2.20. The price of RON97 will be floated and subjected to global oil price fluctuation.
Newly elected Finance Minister Lim Guan Eng has answered former Prime Minister Datuk Seri Najib Abdul Razak’s challenge for Putrajaya to explain how it came to the RM100 billion cost estimates for the cancelled Kuala Lumpur-Singapore High-Speed Rail (HSR) project. The ex-Prime Minister Datuk Seri Najib had rubbished the RM100 billion figure, saying his administration had estimated the cost of the HSR project to be just RM72 billion.
Finance Minister, however, said the new estimate takes into consideration of the interests incurred to finance the project. “Please be truthful, when you want to make statements don’t think you have the facts.” said Lim. “In the past, you may have the facts, but now we have the facts. If you include interest component (the HSR cost) is way above RM100 billion,” he said at a press conference in Putrajaya today. He then cited a quote popularly attributed to Abraham Lincoln that “you can fool all the people some of the time and some of the people all the time, but you cannot fool all the people all the time”. The high-speed rail (HSR) connecting Kuala Lumpur and Singapore is a joint project with the city-state. The HSR deal, agreed by the previous federal administration in December 2016, was designed to speed passengers between the two cities in 90 minutes.
The HSR project is projected to be completed in 2026. The train route was meant to host eight stations whereby seven stations will be in Malaysia and one in Jurong East, Singapore — with 335km of the line located in Malaysia and another 15km in Singapore. It was estimated that 22 million people will ride the line by 2036. However, the newly elected cabinet has agreed to cancel this project due to the project high cost. Dr Mahathir had previously described this HSR project, which valued at RM110 billion, as being “unnecessary and will not earn the country a single sen”.
The decision to cancel the HSR had come under fire from several quarters, among them Barisan Nasional Strategic Communications Unit chief Datuk Abdul Rahman Dahlan. Singapore has yet to comment on the issue.
Malaysia newly appointed Prime Minister Tun Dr Mahathir Mohamad said the government may take another look at several large projects that are being shelved to reduce the country’s financial burden of the country. Dr Mahathir, who had put the national debt higher than stated by the previous administration, said the government will reconsider some of these projects when the country achieves better financial position.
“What we are doing now is to ensure that these borrowings can be handled, government spending is reduced and we will achieve a budget that will not show a very big deficit,” he said in Putrajaya yesterday. The government cancelled the first mega project initiated under the previous administration on Tuesday — the high-speed rail (HSR) connecting Kuala Lumpur and Singapore — a RM110 billion joint project with the city-state. The train route was meant to host eight stations — seven in Malaysia and one in Jurong East, Singapore — with 335km of the line located in Malaysia and another 15km in Singapore. It was estimated that 22 million people will ride the line by 2036. The HSR deal, agreed by the previous federal administration in December 2016, was designed to speed passengers between the two cities in 90 minutes when it is completed in 2026.
Speaking to the media after chairing a Cabinet meeting in Putrajaya on Wednesday, Dr Mahathir said the decision behind Malaysia’s withdrawal from the HSR deal was due to the project’s high cost. Dr Mahathir had previously described the HSR project, which valued at RM110 billion, as being “unnecessary and will not earn the country a single sen”. To a question on whether the HSR project could be reconsidered if the country’s finance is in a better position, Dr Mahathir replied, “definitely.” Dr Mahathir said despite the government’s withdrawal from the project, discussions between Malaysia and Singapore will be held to provide greater clarity on the matter. “The Cabinet has agreed to cancel the HSR but the final decision depends on a discussion with Singapore,” he said. “We will listen to them. They are our good partners,” said the Prime Minister.
The PM had previously said that Malaysia may have to pay a penalty of 500 million for cancelling the project, but he was unsure if the amount was in ringgit or Singapore dollars. “I have yet to verify the denomination, but I suppose it will be in ringgit,” he said earlier this week. Apart from the HSR cancellation, Dr Mahathir also said the government has agreed to cancel another railway initiative, the third mass rapid transit (MRT3) project. In a tender notice released in November, MRT Corp said MRT3 is expected to span 40km, stretching 30km underground with a total of 26 stations. CIMB Equities Research had in September forecast the project would cost between RM35 billion and RM40 billion. “The MRT3 project will be discontinued,” Dr Mahathir said. Other multibillion ringgit projects still under review include the East Coast Rail Link (ECRL) and the Bandar Malaysia project. In March, it was estimated that the RM55 billion ECRL had reached a progress rate of 13% and is expected to be completed in June 2024.
The present government is trying to cut down its obligations after announcing that the national debt was RM1 trillion, considerably higher than the previous government’s figure of RM686.7 billion.