KUALA LUMPUR, Nov 7 -- Sizeable public outlay, efficient spending and execution remain key to the successful implementation of Budget 2021 measures to revitalise the economy, said UOB Global Economics and Markets Research.

Its senior economist, Julia Goh said short and medium-term measures announced in the budget were crucial in supporting the economy from crisis to recovery, providing further impetus for economic growth targeted at 6.5 per cent to 7.5 per cent in 2021, and helping narrow economic and social divide exacerbated by the pandemic.

“Notable measures announced include further cash assistance for the bottom 40 per cent of the household income (B40) group, lower income tax for middle-income group, extension of wage subsidy programme, higher medical tax relief, restart of key infrastructure projects, and further investment incentives,” she said in a note, today.

On managing fiscal risks, she said the government has established fiscal reform initiatives and formulated a new act that allows for temporary financing and implementation of fiscal response measures. 

“As such, the debt ceiling has been temporarily raised to 60 per cent of gross domestic product (GDP) until end of 2022 to allow sufficient fiscal space during the period of fighting the COVID-19 pandemic,” she said.

The fiscal deficit was projected to decline to 5.4 per cent of GDP in 2021 from an estimated 6.0 per cent in 2020.

Meanwhile, Malaysian Institute of Accountants (MIA) president Dr. Veerinderjeet Singh said projects and initiatives under the budget should be monitored closely, and ensure that the outcomes were in line with the desired targets, especially long-term reforms for sustainability.

“MIA hopes that there will be an emphasis on budgetary governance to ensure that the spending is prudent, without wastage and achieves the desired outcome,” he said.

MIA chief executive officer Dr Nurmazilah Mahzan said the measures outlined clearly meant to stimulate the economy, enhance social and health safety nets, protect business continuity, and drive long-term sustainable development reforms. 

“In line with our nation-building purpose, MIA is ready to deploy its expertise to support the implementation of the budget proposals,” she said.

-- BERNAMA