27/10/2025

MONDAY | OCT 27, 2025

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COMMENT by Dr Rais Hussin

Restoring balance beyond ledgers B UDGET 2026 was tabled with the reassuring confidence of prudence. It promises a narrower deficit of 3.5% of GDP, based taxes were introduced, and the long-awaited carbon tax, still in pilot phase, targets only the iron, steel and energy sectors. In other words, Malaysia is consolidating, not modernising. budget exposures, guarantees and GLIC (government-linked investment

The Madani framework aspires to such stewardship. To make it credible, the government should publish quarterly dashboards showing how rationalisation savings are channelled, with data-driven transparency, into visible social dividends. The same principle applies to GLIC and MOF-Inc co-funding. If these partnerships are substitutes for direct fiscal expenditure, they must follow clear hurdle rates, return expectations and public scorecards on job creation, domestic content and social impact. Otherwise, “optimising national resources” risks becoming another euphemism for off-balance-sheet opacity. Reinvention demands courage as much as competence. Malaysia should anchor its fiscal policy in three principles: 0 Adopt a transparent debt rule with a growth clause – reaffirm the medium term 60% ceiling while allowing temporary deviations tied to cyclical conditions and automatic corrections. 0 Reprofile debt towards long-term, high-impact investments, publishing cost-benefit analyses and post completion reviews for major projects. Borrowing should finance transformation, not transmission losses. 0 Institutionalise IOOI-based performance reporting across ministries so every ringgit borrowed is traced through inputs, outputs, outcomes and impacts — converting fiscal data into policy intelligence. Such measures would safeguard macro-stability while transforming debt into a disciplined instrument of value creation. When properly governed, debt becomes the seed capital of the future, not the mortgage on it. The moral of solvency lies not in balanced ledgers but in balanced lives. Fiscal sustainability must translate into social sustainability – the resilience of the households that carry the nation’s productivity and whose tolerance for reform hinges on credibility. DrRais Hussin is the founder of Emir Research, a think-tank focused on strategic policy recommendations based on rigorous research. Comments: letters@thesundaily.com

company) co-funding. Transparency is not an accessory of good governance; it is its architecture. To reinvent rather than restrain, Malaysia must distinguish between consumption debt and investment debt. Borrowing for subsidies and operations entrenches dependency while borrowing for productivity enhancing projects multiplies capacity. At least one-third of new net borrowing should be ring-fenced for projects with demonstrable economic multipliers: grid modernisation, digital and green infrastructure, SME technology adoption and mission oriented research and development, with high domestic value-added. Such borrowing must also be long tenor and outcome-linked. Malaysia could pioneer “Impact Sukuk ” or outcome-based bonds, where coupon rates are tied to verified progress in employment, carbon reduction or innovation metrics. This aligns fiscal discipline with measurable impact – a principle long championed by Emir Research through the Input-Output Outcome-Impact (IOOI) framework. Equally critical is the revenue modernisation agenda. Rather than relying on the regressive SST, which burdens lower-income households while narrowing the tax base, Malaysia should reinstate a modern, targeted goods and services tax (GST) framework. Properly designed with exemptions, GST is progressive in effect: it captures value across the economy, broadens the base and allows direct rebates to protect the vulnerable. Implemented alongside tighter capital-gains enforcement, a modest carbon-price pilot and digital-tax expansion, it would build a fairer, more sustainable revenue architecture. True fiscal reform must never punish consumption but reward productivity; taxation should be the mirror of justice, not convenience. Debt management is not an accounting exercise but a moral one. Today’s borrowing must yield tomorrow’s opportunity. When citizens see that public borrowing funds real progress such as schools, transport and digital inclusion, fiscal discipline becomes a shared ethic, not a distant rule.

RECENTLY, I came across an interesting article on Facebook where a CEO in the aviation industry publicly praised one of his staff members for napping while on duty. While the gesture may have been intended to show empathy and understanding, it sparked a different perspective in me. In safety-critical industries such as aviation, healthcare and transportation, sleeping during duty hours raises serious safety and operational concerns. Napping on duty can often be a symptom of deeper, systemic issues within an organisation. These may include inadequate fatigue management policies, limited education on sleep hygiene or the absence of effective fatigue and fitness an allocation of RM421.2 billion, and a renewed commitment to fiscal responsibility under the Madani framework. The message is clear: tightening its belt while sustaining welfare. However, beneath this narrative lies a deeper question: What kind of discipline are we practising? Prudence that merely constrains or prudence that creates? If fiscal policy is to become a lever for transformation rather than containment, debt management must evolve from bookkeeping to a strategic architecture for national reinvention. Malaysia’s public debt stands at RM1.304 trillion, or 64.7% of GDP, brushing the statutory ceiling of 65%. Debt-service charges alone consume an estimated RM46 billion annually – nearly matching allocations for health and higher education combined. The challenge is not the debt level but its diminishing returns. Unless debt is tied to productive investment and transparent governance, we risk managing decline rather than shaping growth. Budget 2026, the first fiscal blueprint under the 13th Malaysia Plan, remains conservative. Operating expenditure dominates at RM338 billion while development spending stands at RM83 billion, which is also lower than last year’s level and barely a fifth of the total budget. This ratio signals not reinvention but routine. Much of the projected savings arise from targeted subsidy reforms and administrative consolidation rather than new revenue streams or institutional restructuring. The Budi95 programme is necessary to curb leakages and protect lower-income households. But without airtight data governance and reinvestment of savings into productive ventures, rationalisation risks becoming a fiscal patch, not a reform. The revenue side tells a similar story. Receipts are projected to rise 6.7%, from RM253 billion to RM270 billion, driven mainly by an expanded sales and service tax (SST), e-invoicing compliance and improved collection. No new broad

Such restraint reassures markets but offers little to the people. Fiscal consolidation without structural transformation risks reproducing inequality under a disciplined facade. It is a going-concern budget – competent but cautious,neat but not yet brave. Furthermore, the global environment leaves Malaysia little room for complacency. As advanced economies pivot towards high-tech and green reindustrialisation, the cost of inaction compounds quickly. Debt-service costs crowd out investment in research, skills and logistics, which constitute the ingredients of productivity growth. A deficit reduced on paper but accompanied by stagnating total factor productivity is no victory; it merely shifts the burden from the treasury to future generations. A transformational budget would leverage debt as a strategic instrument, converting every ringgit saved from leakages or low-value spending into high multiplier investments. Yet, Malaysia’s development-to-GDP ratio has slipped to around 3.3%, from 4.4% a decade ago. Our public investment pipeline remains opaque, with few projects transparently linked to measurable outcomes in technology adoption, export complexity or rural productivity. Fiscal discipline, when detached from purpose, becomes ritual. The task now is to restore purpose. How a nation manages its debt reflects how it manages itself. The true deficit is not numerical but moral – the leakages, inefficiencies and opaque linkages between government-linked companies (GLC), statutory bodies and public funds. Each ringgit lost to mismanagement is a ringgit borrowed in vain. Malaysia must treat anti-corruption reform as a revenue measure. Open contracting, real-time spending analytics and outcome-based audits should become standard across ministries. The Finance Ministry could publish an annual fiscal risk and contingent liability statement consolidating off

“The challenge is not the debt level but its diminishing returns. Unless debt is tied to productive investment and

transparent governance, we risk managing decline rather than

shaping growth.

Napping on duty: Deeper look into workplace fatigue

0 Medical psychological influences: In some cases, napping on duty may be linked to medical or psychological conditions. Sleep disorders such as insomnia, narcolepsy or sleep apnea, as well as medications with sedative effects, can significantly impair alertness. Likewise, stress, anxiety and depression can alter sleep patterns and overall energy levels. Ultimately, rather than viewing workplace napping as an individual failure or a harmless act, organisations should see it as a signal – a reminder to strengthen their fatigue risk management systems, promote better sleep education and support the overall well-being of their workforce. Prof Dr Louis Adaikalam President Malaysia Sleep Apnea Association Strategic Partner of Miros and

LETTERS letters@thesundaily.com

risk management programmes. Contributing factors 0 Inadequate sleep: Many employees experience poor sleep duration or quality, often due to stress, environmental disturbances or underlying medical conditions. 0 Shift work and irregular hours: Rotating or night shifts disrupt the body’s natural sleep-wake cycle, leading to circadian rhythm misalignment. A state where the internal body clock conflicts with external work schedules. 0 Workload and task design: Extended working hours without sufficient rest breaks, monotonous duties that lower alertness or high cognitive demands that drain mental energy all contribute to fatigue.

Napping on duty can often be a symptom of deeper, systemic issues within an organisation. These may include inadequate fatigue management policies, limited education on sleep hygiene or the absence of effective fatigue and fitness risk management programmes. – SYED AZAHAR SYED OSMAN/THESUN