2012 Budget Highlights

TAN SRI ROBERT PHANG

he following are the highlights of the 2012 Budget tabled by Prime Minister Najib Tun Razak, who is also Finance Minister, at the Dewan Rakyat on Friday:

* Government will introduce other transformation programmes, culminating in the National Transformation Policy, effective 2011-2020.
* RM232.8 billion allocated to implement all government development plans, focusing on the well-being of the rakyat, with RM181.6 billion for operating expenditure and RM51.2 billion for development expenditure.

* RM13.6 billion allocated to the social sector, including education, training, health, welfare, housing and community development.

* Government will implement a special stimulus package through private financing initiative, through which total projects amounting RM6 billion will be carried out.

* 2012 announced as the year of National Innovation Movement, with a RM100 million allocation to implement several strategic initiatives.

* RM50.2 billion for the education sector, with a development allocation of RM1.9 billion for the Education Ministry to be spent on all types of schools.

* RM1 billion to be provided through a special fund for the construction, improvement and maintenance of schools, particularly to cater to their immediate needs.

* Abolition of RM24.50 and RM33.50 for co-curriculum, internal test papers, Malaysian Schools Sports Council fees and insurance premium involving students in primary and secondary schools respectively, beginning the 2012 school year.

* Financial contributions from companies and individuals to upgrade school facilities to be eligible for tax deductions, to encourage more charitable activities.

* Existing National Agrobusiness Terminal (TEMAN) in Wakaf Che Yeh (Kelantan) and Gopeng (Perak) will be developed as Rural Transformation Centres pilot projects, with four more RTCs to be developed in Kedah, Johor, sabah and Sarawak.

* Establishment of Professional Services Fund to encourage professionals such as lawyers, doctors and accountants to set up firms in small towns, with BSN providing RM100 million for soft loans with an interest of 4 per cent.

* RM110 million for the implementation of the Rural Mega Leap Programme covering 6,500 hectares in 11 Agropolitan Projects nationwide for the cultivation of commodity and cash crops as well as cage fish culture.
* RM140 million to implement RISDA's new planting and rubber re-planting programmes benefiting 20,000 smallholders.

* RM5 billion proposed to strengthen the development of rural basic infrastructure in a more comprehensive manner.

* RM500 million to continue implementing projects to upgrade basic infrastructure under "Projek Penyelenggaraan Infrastruktur Awam" and "Projek Infrastruktur Asas", providing opportunities for 29,000 Class F contractors registered with the Contractor Service Sector.

* RM50 million to expand rainwater harvesting programme to Sabah.

* RM400 million to upgrade water supply infrastructure in selected Felda areas, besides RM50 million to connect the reticulation system in estates to the main pipes.

* RM150 million to be provided to the Public Transport Development Fund in the SME Bank to enhance bus services for the rural community.

* RM90 million for the provision of basic necessities which includes expanding the clean water supply project as well as income generating programmes for the Orang Asli community.

* Introduction of the New Civil Service Remuneration Scheme (SBPA) to replace the current scheme.

* Improving the salary of civil servants through a single-tier structure with additional increments to enable civil servants to continue receiving annual increments over a longer period.

* Annual increment of civil servants to be increased between RM80 and RM320 according to their grades, beginning 2012. Those who opt for the SBPA will receive an annual increment of between 7 per cent and 13 per cent.

* With the implementation of SBPA, more than 600,000 government pensioners will benefit from a pension adjustment involving an allocation of RM600 million.

* Effective 2013, the government will implement an annual pension increment of 2 per cent without having to wait for any review of the remuneration system or salary adjustments.

* Extension of compulsory retirement age from 58 to 60 years old to optimise civil servants' contribution.

* Additional bonus of half-month salary with a minimum payment of RM500 for civil servants and an assistance of RM500 for government pensioners, to be paid together with December 2011 salary.

* RM120 million to offer 5,000 Masters and 500 doctoral scholarships for eligible civil servants, including teachers.

* The government will offer 20,000 places for diploma teachers to pursue undergraduate studies.

* A special one-off payment of RM3,000 to 4,300 individuals who have completed their contracts with the Department of Special Affairs (JASA) and Social Development Department (KEMAS).