KUALA LUMPUR: The announcement of the halfmonth bonus for civil servants by the government on Wednesday will not increase the country's fiscal deficit target of 4.7 per cent for this year, said Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah.
"The country's revenue was expected to increase with the higher revenues from the Inland Revenue Board (IRB) and Royal Malaysia Customs for this year as compared to last year,"
he said yesterday, referring to Prime Minister Datuk Seri Najib Razak announcement of bonus--payout, with a minimum payment of RM500 for civil servants and a special payment of RM500 for pensioners, to be paid on Aug 9.
The RM2.2 billion bonus and special payment will benefit 1.27 million civil servants and 657,000 government pensioners.
The additional revenue from both agencies will create additional cash flow to reduce the country's debt, he said.
Despite the additional spending, Ahmad Husni forsees the deficit target for the country to maintain its course for this year and is optimistic the number to reduce further for the same time next year.
The country's present expenditure is in line with achieving a medium--term deficit target of around 3 per cent by 2015, he said.
"We are managing our expenditure based on concept of value for money and if we can cut we will cut," he noted.
The economic turmoil faced by the five European nations namely Greece, Spain, Italy, Portugal and Ireland, Ahmad Husni reiterated, had not caused a blow to the nation's economy, stating that the country's present economy and financial institutions were in safe hands of a capable administration.
"Malaysia's exposure to the eurozone crisis was only about 1.5 per cent in terms of total trade," he clarified.
Ahmad Husni was also optimistic the country's gross domestic product growth was well on its way to achieve the 4.5--5 per cent for this year.
It was reported that Malaysia last year had a national debt of 53.8 per cent of Gross Domestic Product (GDP) and a budget deficit of 5.4 per cent of GDP.