00:00May I kindly invite Yang Amat Berhormat, Datuk Sri and all our VIPs to hold up their guidebooks together.
00:07The most important thing that the government actually focused on is assure supply first.
00:11Because if there's no supply in the country, game over.
00:15Your economy cannot function if there's no supply.
00:18And fundamentally, since we've seen the issues in the Middle East,
00:22have we had issues in the supply in the country?
00:24We have not.
00:26Part of the reason is we've been blessed.
00:28We've been blessed because we're a net energy exporter.
00:30And we have our own capacity.
00:32But also institutions within this country are actually quite well positioned on a global basis.
00:38And they have supply sources that they can actually activate from a global basis
00:42to kind of cushion the blow to us along the way.
00:46So then securing supply was the greatest priority that we had to focus on.
00:51And you'll see that rolling supply basis is continuing forward, right?
00:56So every week we have our M10 meetings.
00:59We look at the position.
01:01And Petronas and other oil companies actually secure our positions on a rolling basis forward.
01:06And we've been able to make sure that that has not been interrupted in the country.
01:10The second thing is actually to make sure that once the supply is secured,
01:14let's make sure where are the pressure points in the economy that's actually been put under risk.
01:20And what do we do about it?
01:22So the reality, this is a supply crunch.
01:24And because of the supply crunch, price implication, inflation will happen.
01:29But the reality is for us, we got lucky.
01:32Because we did our reforms three years ago.
01:36So let me give you a guesstimate today based on numbers that we're seeing today.
01:41If I did not do my reform on diesel and petrol, my bill for this year would be higher than
01:49$10 billion more.
01:52Because we've done reforms that have adjusted market pricing for segments of the market that can absorb some of the
01:58movements,
01:59we've been able to reduce the fiscal burden to the country.
02:03But the second thing, we had some core principles.
02:05Our core principles was we need to make sure that vulnerable groups in society are looked after.
02:12So you've seen that we've not moved the wrong 95 price.
02:16We're still able to buy $199 in the shops.
02:21But what we did with Budi was actually cut the ability of the 95 to be accessed by non-warga
02:31negara.
02:31And that's important because that's allowing us to manage leakages that could actually occur.
02:37The second thing is, as the situation was developing and we see much more price adjustments,
02:42and we saw that the quotas maybe when we gave first time around was a bit too generous,
02:46we reduced the quota from $300 to $200 temporarily.
02:50And that's also helped us to manage in.
02:53But it's also encouraging and bringing along the right yard to play their part in managing the issues as we
02:59move along.
02:59So this is what we call mechanisms that are good, that are adjustable,
03:05but when it transmits into the economy, it's also cushioning people from the inflationary effect that it's going through.
03:12That's why, as Yama Muhammad Datsri mentioned just now,
03:16inflation in the country is still fairly moderate.
03:20The inflation number up to the end of March was 1.9%.
03:26It's still within the ranges that we're talking about, between 1.5 to 2.5,
03:31and a lot better than a lot of places.
03:33So cushioning the blow to society is also important.
03:37Then we also saw the impacts that were flowing through,
03:40because where the prices were not subsidised,
03:45there may be some cost pressures in the industry,
03:48there may be some groups, particularly the SMEs,
03:51that will be a bit more exposed.
03:53So what did the government respond?
03:54It did not respond using stimulus.
03:58Because in a supply crunch, putting stimulus is the wrong intervention.
04:05Stimulus leads to even higher inflation.
04:08And higher inflation immediately goes down
04:10and affects the majority of the people along the way.
04:14So what do we do?
04:15We provide lifelines.
04:16We focus at the SMEs, we focus at the micro groups,
04:22and we've provided 5 billion out of Bank Negara,
04:245 billion from guarantee schemes,
04:26and another 5 billion coming in from micro financing schemes
04:31to provide support to that group.
04:35The banks also played their part.
04:37The banks also welcomed mechanisms where,
04:40if there were people who were under pressure,
04:41please come to the banks, talk,
04:43and we'll look at R&Rs and moratoriums,
04:46whatever can be done,
04:48to also effectively provide lifelines
04:52for people to continue to manage.
04:54Hence, I think that's the art of balancing that we've done.
04:59This doesn't mean that the government itself doesn't have challenges.
05:02It does.
05:03So today, what was 700 million a month on fuel subsidies
05:08in January and February jumped up to 5 billion in March.
05:13At some point in April,
05:15it actually even hit 7.5 billion ringgit of subsidies.
05:19But now, with prices coming down and moderating,
05:22we're probably sitting at about 3.5 to 4 billion ringgit of subsidies.
05:27These numbers, we can try to manage through.
05:31Some of the trying to manage through means
05:33better efficiency in our cost management.
05:35And so therefore, a controversial push that we set is,
05:39we want to see that the government also takes steps.
05:42Where you have costs that you can save,
05:44can you curtail your budgets?
05:46And all the ministries have stepped up.
05:48Up to today, all the ministries have committed
05:515 billion ringgit of savings coming in from this budget.
05:55Not by removing essential spends,
05:58but looking at things that don't have to be spent this year.
06:01Some trainings they can afford to put out,
06:04they put out.
06:05Some of the unfilled vacancies,
06:07they can delay a little bit,
06:08they delay a little bit.
06:10Better procurement mechanisms to reduce cost of purchasing
06:12has also helped us reduce the cost.
06:16Not going to conferences globally,
06:19if it can be done virtually,
06:21has also accepted it.
06:22Work from home mechanisms
06:24also have helped reduce some of the cost.
06:26So it is a much more whole-of-government approach
06:29to help the budget to be managed in a better form.
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