(there is a saying, that if you are not good at cheating,don't attempt to cheat,you will get caught,with your pants down and Najib is in that predicament now)
Najib Razak has claimed that the 20 sen hike on RON95 and diesel would help the country to reduce its fiscal deficit.He further claimed that the move would save RM1.1 billion in the remainder of 2013 and RM3.3 billion annually.
To cushion the impact due to fuel price hike, Najib also announced that the cash payout for 1Malaysia People’s Aid (BR1M) would be increased in the Budget 2014.
However, he did not state how much it would be.
Let's assume the government would pay RM600 for household earning less than RM3,000 and RM300 for bachelors, BR1M 3.0 would cost the government a whopping RM3.48 billion, slightly more than the RM3.3 billion saved from the fuel subsidies.
For BR1M 2.0,the government paid a whopping RM2.9 billion.A total of 6.8 million recipients received the cash aid, with 4.8 million receiving RM500 for those with household income of less than RM3,000 and another 2 million receiving RM250 for bachelors earning less than RM2,000.
So Najib will saves RM3.3 billion from the fuel subsidy and pay out RM3.48 billion on BR1M 3.0 annually, mathematically, this has expunged Najib’s claim that the fuel price hike would help to reduce country’s fiscal deficit.Now, how will the government recover the deep financial hole it'll be in from their BR1M 3.0 exercise?.Goods and services tax, new electricity tariffs or new taxes? You name it. It seems like a people-unfriendly Budget 2014 is coming our way.
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