SHAH ALAM: ARMED Forces chief General Zulkifeli Mohd Zin is not known to shy away from a fight. But even the veteran soldier seemed uncomfortable when the conversation turned to the 2016 Budget at a function on Thursday.
He did not really say anything on the budget – he would have to if I had followed up with a question – but his body language was enough to show – at least to me – that the Defence Ministry will get a big hit when the Prime Minister presented the 2016 Budget on Oct 23, 2015.
General Zulkifeli was speaking to the press after a ceremony to honour serving and retired Armed Forces personnel who were injured in service. During the meet and greet session prior to the ceremony, Zulkifeli even said the food served for lunch was too little “due to the economic crisis”. It could have been a joke but the lunch menu seemed to reflect what he had said.
At the Press conference later, General Zulkifeli acknowledged that one question he could not answer was “when will the disability pension be increased?”. It was the most repeated questions especially from those who had retired. He said the Armed Forces had forwarded the request to the government and hopefully “it will be raised when the government can afford it”.
It was at this point I knew I could asked about the 2016 Budget, but I decide against it. There are still less hot-button issues – the AV4, Blackhawks, Yemen and others – that had not been asked. So I decided to focus on the issues and leave the budget questions to the politicians.
Anyhow, as I stated before it is likely that the budget for the Defence Ministry and the Armed Forces will be reduced next year. No one I spoke too was able to come out with a figure though so its up to me to come with it based on my conversations and a review of the budget for the last ten years.
(The budget from 2011 to 2014 are the final allocation for the financial year including the additional funds sought during the mid-year, an annual ritual)
Based on the graphic above, we can surmised that the 2016 budget – the first in the RMK11 – could even be lower than the 2011 figure (RM14.2 billion) the first one for RMK10.
How much lower? It will be RM12.1 billion, of which RM11.3 billion will be the Operating Expenditure (OE) while whats left will be the Development Expenditure (DE) or procurement budget.
What they are going to do with around RM800 million for procurement then? Not much really, apart from all of the project already in the books like the LCS, AV8, A400M (one this December, with two more in 2016) and the Pilatus PC-7 Mk II (to be delivered by early next year).
If thats the case, can the Ministry signed on for new stuff? Yes, they can as most of the payment only starts when the items are delivered.
It must be noted that if the OE is at RM11.3 billion, 60 per cent of the amount will be for Emolument (salaries and allowances) and the rest is for non-personnel emoluments like operational costs from fuel, spare parts and maintenance.
So the Armed Forces will have to make do with around RM4 billion or so to pay for its operations for the next 12 months even though it has more stuff – new and old – than five years ago. Basically each services will get around RM1.5 billion each to pay for everything. Yes they can ask for extra allocation during the mid-year review but it will be very tough for those planning operations and maintenance.
And that if the Defence Ministry gets the amount I am predicting. What if its lower then? You guess is a good as mine. As for the Home Ministry and its agencies, it will also be in the same boat as Defence though its unlikely they will curtail normal policing operations.
I am also of the opinion that the Home Ministry will get a lower allocation that the 2011 figures. Again as the 60 per cent of the OE allocation will be for Emolument, the DE will also be much smaller. For 2016, I expect that the Home Ministry allocation will be around RM9.5 billion – RM9 billion for OE and RM500 million for DE.
Anyhow, please check back this website on the evening of Oct 23, 2015, for the review of the 2016 budget. I hope I am wrong about the allocation for defence and national security.
— Malaysian Defence
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View Comments (39)
It is "due to the economic crisis"?
All of the politicians are telling the people our economy is "good and stable" and the armed forces chief is saying otherwise LoL.
Anyway most of the countries around us is increasing their defence budget. It would paint a bad picture of malaysia if we don't.
"...due to economic crisis".
As RM falls against USD and EURO, with majority asset sourced from abroad, and allocation gets lower by the year, I agree that it will be tough on those in charge of maintenance .
Reality bites. With gst n reduction in subsidies everywhere the gov still dont have enough money to go round. How sad. The amout of gst collected to date is more than RM6 billion de
It will be a tough year for all when global n local economic still uncertainty. Hope the $ we pay through product n road will give us a better life.
Poor to arm forces where they need new equipment or extra units to operate n keep our country safe...
Hope the defence budget not as low as you forecast
When it is convert to $$$ instead of RM you will see the real big hit.
Now, we can regret to have 12 variants gempita while actually there is only 5 variants are enough.
National interest. There is plenty of money being spent on all sorts of nonsense. Who is to blame? The Rakyat is to blame because they allowed this to happen in their name.
Its about time that the armed forces chief to really point the reality to each of the services head. Plan to get the best possible equipment and services within the available budget. Please stop planning "daydream" requirements that is not in line with the available budget.
Improvisation is the way I see it. The emoluments should not be look at as just for the welfare of the personnel but to buy their brains. North Korea and Iran have been sanctioned for a long time yet they are feared by big power. Maybe with significant backup from certain another big power but nonetheless most ground work are their own initiatives.
12 variants gempita, The Atlas procurement really take effect now. The armed forces will pay the prices for what it doesnt need at first place.
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The Army needs a new AFV.
Well, the army really need new afv to replace the condor and sibmas. But not super overpaid Pars. With so called Transfer of technology. That suck up almost entire armed force budget.