Improving Malaysia’s budget transparency

By Khairah Makata, The Malaysian Insider

I, as a representative of Centre for Public Policy Studies, was invited by the International Budget Partnership and NGO Forum of Cambodia to present the findings for Malaysia’s budget transparency, public participation and institutions of accountability last Thursday, 11th November at the Open Budget Survey Regional Launch in Phnom Penh.

The results, released last October 20, showed that Malaysia improved somewhat from 35 per cent in the last round (2008) to 39 per cent.

However, this improvement held little significance as it still maintains Malaysia in the same category, one of providing minimal information to the public as to how the government spends public expenditure.

Of late, budget transparency has become central to the development discourse; because it touches on credibility and prioritization of policy and decision-making, providing check and balances, limit corrupt and wastage- basically how government uses public funds and other resources of the country. It makes sense to have a transparent budget because the practice in itself comes two-fold: good governance and meaningful public participation. These two are the cornerstones of effective and accountable government.

Without access to budget information, legislators, auditors, CSOs, media, and the broader public are unable to effectively participate in decision-making or hold the executive accountable for public resources usage.

How would this then benefit the executive? Transparency and meaningful public participation can then enhance the credibility of policy choices made and effectiveness of policy interventions introduced by the government. We need to find a middle ground, based on the political reality and standards of which we should be aiming for, where open budgets are accepted practices and for credit to be given where its due (also, for bad practices to get the flak and criticisms it deserves).

Based on the international standards and good practices, a government would typically produce 8 budget documents: Pre-budget statement, Executive’s Budget Proposal, Enacted Budget, Citizens Budget, In Year Reports, Mid Year Review, Year End Report and Audit Report.

Malaysia does not Produce Pre-budget statement, Citizens Budget and Mid Year Review. That’s one of the many reasons why we scored pretty low (global average score is 42 per cent)

The short-term recommendations provided by the Survey were for Malaysia to produce the three documents and improve comprehensiveness of the enacted budget. I suppose the latter may be easier to achieve because it means adding more information to an already available document. This, though, means that we need to identify what kinds of information that are lacking in our existing national budget practices.

Research and analysis of the documents showed that Malaysia’s enacted budget lacked programme level detail, with little information on outputs and outcomes. This makes it difficult to measure achievements and successes, identify leakages or wastages, and in general, monitor the impact of planned activities and its execution.

The former suggestion, start producing AND publishing (because if we aim for transparency, it means little to produce something without allowing the public to access it) the three budget documents may be a bit difficult, but not at all unattainable.