Budget 2016 Revision: Full Statement by PIKOM Chairman, Chin Chee Seong.
In response to the revisions to Budget 2016 as announced by Prime Minister Dato’ Seri Najib Razak, PIKOM views the various measures taken to be more focused on cost of living issues (which is welcomed) and to spur domestic consumption and spending. However, it would have been better if there was also more focus on driving economic performance and strengthening the fundamentals of the country.
On a separate note, PIKOM welcomes the government’s decision to continue its plans for the Malaysian Vision Valley and to promote greater competition in the telco sector via the introduction of open bidding for spectrums. In the same vein, it would have been opportune for the government to consider relooking the affordability of broadband. Reduction in broadband costs will have a catalytic effect on society and the economy in terms of reducing household expenses, the promotion of knowledge based society and other benefits.
The various moves by the government such the RM2000 announcement of tax relief for workers earning below RM8,000 a month and the 3% reduction in employees’ contributions to the Employees Provident Fund may provide some boost in disposable income within the local retail sector, including the ICT sector. This will in particular benefit the lower to middle income group. The one-time salary increment for civil servants is also a welcomed move, though it cannot be ascertained as yet how much of a stimulus effect these measures will have on the economy.
The RM6 billion in additional funds for Development Financial Institutions (DFIs) and Venture Capitalists (VCs) is also a positive move as investing in the development of technopreneurs and the start-up scene will deliver a long-term stimulus effect on the local economy in many ways. PIKOM also welcomes the emphasis on training as evident by the allocation of 30% of levy contribution to reskilling programmes among others.