Husni dismisses debt fears, says government has enough funds

(The Malaysian Insider) – Datuk Seri Husni Hanadzlah said today that the government could still fund its spending as it has large reserves including some RM30 billion in trust funds which are under review.

This comes as concerns rise over whether the government was at risk of going bust due to spending outstripping revenue.

The second finance minister also said that the RM407 billion national debt that grew 12.3 per cent last year was still manageable as it had yet to breach critical thresholds such as revenue to debt service ratio.

Husni said that the government has asked the Accountant-General to review trust funds worth more than RM30 billion.

“These funds were for various programmes but some are dormant,” he told reporters at the sidelines of the MIA-AFA Conference here today. “We have huge reserves.”

The minister also said that the government had more than RM4 billion in contingency funding, RM5 billion in Kumpulan Wang Amanah Nasional, approximately RM1.2 billion in land assets that could be monetised and that it had plugged loopholes in tax collection and has been conservative in estimating its revenue.

Husni said that the national debt was still below the critical level of 55 per cent of GDP and that its loan payment to national revenue was at 10 per cent which was below the “prudent” level of 15 per cent.

He also pointed out that external loans were well below the RM35 billion limit and the debt serving ratio for external loans was at about two per cent.

“It is well within our capability,” he said.