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🇲🇾 Malaysia /Economy & Trade

“These are delayed project commitments”

From Utusan Malaysia · () Malay

Translated from Malay and summarized by DistantNews. Read the original for the full story.

At a glance

News Official statement Context piece
  • Malaysia’s Rural and Regional Development Ministry says its reported excess commitments cover delayed project payments from 2019 to 2021.
  • The ministry says pandemic-related delays left approved obligations outstanding even when annual allocations were returned or remained unused.
  • It used internal transfers to fund contractor claims for delayed rural road projects, including projects under the JALB program.

Malaysia’s Rural and Regional Development Ministry says the excess commitments shown in its spending schedule do not represent new spending beyond approved allocations. They reflect government obligations for projects delayed between 2019 and 2021.

Fadzmel Fadzil, the minister’s press secretary, said the distinction matters because the figures could otherwise be read as evidence that the ministry had spent more than Parliament authorized. The commitments cover previously approved projects, including rural road projects under the JALB program, whose implementation disruptions pushed contractor claims into later financial years.

Government projects may receive approval and funding at different times from the actual construction and payment schedule. Fadzmel gave the example of a project worth RM300 million under the 12th Malaysia Plan, with a ceiling of RM60 million in each rolling plan. Funding is provided in stages according to the expected implementation year.

When the ministry announces a budget and Parliament approves it, the ministry will only implement projects according to the allocation provided. The excess shown is government debt carried into the following year, not a new commitment.

· Fadzmel FadzilThe minister’s press secretary explained why the spending figures should not be interpreted as new expenditure.

Delays, including those during the Covid-19 pandemic, meant that some allocated funds could not be used because projects had not yet been tendered or started. The money could be returned to the Finance Ministry, but the government’s obligation to approved projects remained when work resumed.

Once contractors restarted delayed work, they submitted claims in later financial statements. The ministry then had to find funds to pay them, including through internal transfers from other rural development programs and warrants issued to the Public Works Department for JALB claims. Fadzmel said this reflected commitments exceeding the annual cash ceiling, not discretionary overspending.

This is what happens when project commitments are larger than the annual cash ceiling provided. It does not mean the ministry simply spent more.

· Fadzmel FadzilHe described the financial effect of delayed projects and rejected the characterization as unauthorized overspending.
About this summary

Originally published by Utusan Malaysia in Malay. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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