Some of the key points for Budget 2008

27. As a measure to enhance the quality of PLCs in Bursa Malaysia, the Government has given stamp duty exemption on instruments related to mergers and acquisitions (M&As) of PLCs, approved by SC up to 31 December 2007. To encourage more PLCs to undertake M&A, the stamp duty exemption will be extended to 31 December 2010.

28. Currently, there are more than 1,000 vendors in the oil and gas sector licensed by PETRONAS. However, many of them operate mainly for domestic market. These companies should merge to be more competitive globally. Therefore, the Government proposes stamp duty exemption be given on all instruments relating to mergers of such vendors implemented by 31 December 2010.

29. To encourage the development of the fund management industry, the following measures will be implemented:
First: Foreign ownership on fund management companies and REITs management companies will be allowed up to 70%. The minimum Bumiputera ownership requirement will remain at 30%;

43. To further promote MSC internationally, the Government will host the World ICT Week in Kuala Lumpur in May 2008. Various international ICT conferences and exhibitions will be held, including the World Congress on Information Technology 2008, the conference on United Nations Global Alliance on ICT for Development and MSC International Advisory Panel Meeting. More than 5,000 domestic and international participants are expected to take part in these programmes. It is hoped that more international ICT companies will invest and collaborate with local companies.

50. I also wish to announce that, beginning the 2008 school session, the Text Book Loan Scheme will be provided to all students, irrespective of their families’ income and with no restrictions on the number of eligible children. With this, 5.7 million students will benefit from this Scheme compared with 4.5 million students currently. With these measures, schooling in Malaysia is now completely free.

57. Currently, the Public Service Department (PSD) and MARA sponsor more than 90,000 students in local universities. However, the number of students sponsored in certain specialised fields is still inadequate. Therefore, the Government will increase the number of undergraduate students sponsored by PSD in local universities from 5,000 students to 10,000 annually, beginning 2008.

78. The Government recognises the importance of an efficient public transportation system, especially for the low income group, overcome traffic congestion and improve productivity. Towards this, the Government has taken several measures to implement a comprehensive public transportation system, including rail and bus network in major cities. Over the next four years, a sum of RM12 billion will be expended to improve the public transportation system in Kuala Lumpur and Penang. To alleviate traffic congestion in Penang, the Penang Outer Ring Road (PORR) will be implemented on a tender basis shortly. Public transportation in other major cities will also be improved.

95. Many pensioners depend on income from their savings to meet their financial needs when they are not working. In order to improve returns on their savings, a RM2 billion bond will be issued by Bank Negara Malaysia to be subscribed by senior citizens aged 55 years and above, who do not have permanent jobs. The maximum limit per person is RM50,000, with a maturity period of three years and a rate of return of 5% per year. Similar bonds have been issued amounting to RM3.5 billion.

96. To reduce the financial burden of the poor and needy senior citizens, the Government will increase their allowance from RM200 to RM300 per month, effective from 1 January 2008.

105. The Government had announced in the 2007 Budget that all PLCs are required to disclose CSR activities in their annual financial reports. Beginning financial year 2008, PLCs will be required to disclose their employment composition by race and gender, as well as programmes undertaken to develop domestic and Bumiputera vendors. The private sector should leverage upon the strength of Malaysia’s diversity by employing Malaysians from all ethnic groups.

110. Police presence and visibility will be increased, particularly in crime-prone areas. In line with this, the capacity and efficiency of PDRM will be enhanced with the recruitment of 60,000 new personnel over the next five years. Investigating officers and assistant investigating officers will be supplied with an additional 2,000 national cars and 1,600 laptops. In addition, 1,900 motorcycles will be provided to increase police presence. PDRM will also set up a Mobile Forensic Unit in each police contingent.

122. As a start, Secretaries General of ministries and Heads of Services will be offered a three-year contract and their performance rewarded based on KPIs. This contract will be offered to officers who are currently serving in the Diplomatic and Administrative as well as in other relevant services. Apart from ensuring excellent service, the contract period of three years will provide adequate time for them to plan and execute projects effectively. This scheme will be effective from 1 January 2008. I am confident that the public will benefit greatly from the enhanced efficiency of government services.

123. To ensure efficiency of administration, the Government has appointed Grade 41 officers to fill up the vacancies on a contract basis. Many of these contract officers have exhibited high work performance and proven their suitability to be appointed to permanent posts. These contract officers will be absorbed into the civil service upon recommendation by heads of departments.

124. Government expenditure will continue to focus on capacity building to support sustainable economic growth through provision of infrastructure, public facilities, education and social services, including health and welfare of Malaysians. For the strategies and programmes which I have announced, I proposed that, a sum of RM176.9 billion be appropriated in 2008 Budget, 10.9% higher compared with 2007. Of this, RM128.8 billion is for Operating Expenditure while RM48.1 billion for Development Expenditure.