2019 Malaysia BUDGET SPEECH BY YB TUAN LIM GUAN ENG MINISTER OF FINANCE (Part 3)

Link to the original post: The 2019 Budget Speech

1. In line with the Government’s intent to assist civil servants
   acquiring their homes, the Public Sector Housing Financing Board
   will extend the loan repayment period from 30 to 35 years for the
   first loan, and from 25 to 30 years for the second loan.

2. The Government will also allocate RM400 million for the
   upgrading, repair and maintenance of government housing
   quarters of the police, armed forces and teachers to improve the
   living conditions and ensure their fitness for occupation.

3. The Government has already announced that we have
   exempted construction and building materials from SST. In return,
   we have secured the commitment from the Real Estate Housing
   Developers Association (REHDA) that there will be a 10% reduction
   in the price of houses that are not subjected to price control in new
   projects.

4. There is an existing over-hang of RM22 billion worth of
   residential properties as at 31 March 2018, a 65% increase as
   compared to RM13.3 billion last year. To address this, the
   Government will for a limited time of 6 months only, starting 1
   January 2019, waive all stamp duty charges for first time
   purchases of homes valued between RM300,001 and RM1 million.
   This will be part of a National Home Ownership Campaign, where
   in return, developers will offer a minimum price discount of 10%
   for these residential properties.

5. Finally, as a demonstration of this Government’s willingness
   to explore new, technology-enabled and innovative mechanisms to
   solve our housing problems, we will be approving private sector
   driven ‘Property Crowdfunding’ platforms which will serve as an
   alternative source of financing for first time home buyers. These
   exchange platforms will be regulated by the Securities Commission

under the peer-to-peer financing framework. As an example, the
buyer will be able to acquire a selected property for 20% of the
price of the property, while the balance 80% will be fulfilled via
potential investors who are interested to fund the acquisition in
exchange for the potential appreciation in value of the property
over a particular period of time.

1. In simple terms, Ah Chong will be able to own and stay in a
   RM250,000 property by paying up RM50,000 without having to
   procure a mortgage. Ali who might only be interested in investing
   in a new property for capital appreciation will fund the balance of
   the RM200,000 via the peer-to-peer Property Crowdfunding
   exchange. This financial innovation will be the first in the world,
   and if successful, will transform the affordability of homes for firsttime
   home buyers in the country. The first exchange is expected
   to go live in the first quarter of 2019, after all necessary approvals
   are obtained from Securities Commission.

Encouraging Public Transport Adoption

Mr Speaker Sir

1. After housing expenses, transport is the next biggest expense
   item. Many household don’t just own one car, they own at least
   two. The typical monthly expenses for just a Perodua Myvi would
   be approximately RM900 after taking into consideration the loan
   instalment, petrol, parking and maintenance. Therefore, a key
   solution to increasing the real disposable income of Malaysian
   households is to migrate from private car ownership to the
   adoption of public transport.

2. To increase the utilisation of public transport, the
   Government will allocate RM240 million to introduce a RM100
   unlimited public transport pass, to kick off initially on the RapidKL
   rail and bus network on 1 January 2019. There will also be a RM50
   monthly pass available just for RapidKL bus services only. The
   campaign will be expanded to other bus companies at a
   subsequent stage. This scheme will immediately increase the
   disposable income of households by hundreds of ringgit a month.

3. The Government’s wholly-owned public transport subsidiary,
   Syarikat Prasarana Bhd will also seek to improve its bus network
   by fully utilising and optimising its current fleet of 1,131 RapidKL,
   408 RapidPenang, 69 RapidKuantan and 300 MRT feeder buses.
   The company will also work in partnership with other existing bus
   companies to manage routes and services as well as cost control,
   in order to maximise efficiency and the quality of service.

4. The reduction of LRT3 and MRT2 construction cost increases
   the operational viability of the projects, which in turn translates
   into lower public transportation fares. This will encourage public
   transportation usage.

5. Kuala Lumpur City Council, will allocate RM20 million next
   year to provide additional free GoKL free bus services from the
   existing 4 routes to further improve public transport coverage in
   Kuala Lumpur.

6. The Government will also make available RM500 million for
   a Public Transport Loan Fund with 2% interest subsidy via Bank
   Pembangunan Malaysia available to taxi and bus companies as
   well as other public transport operators.

7. The Government will freeze toll hikes on all intra-city tolls
   around the country for 2019 that will cost the Government
   approximately RM700 million. The Government will also abolish
   toll for motorcycles for the First and Second Penang Bridge, as well
   as the Second Link in Johor, costing approximately RM20 million
   per annum effective 1 January 2019.

8. In addition, the Government will prioritise solutions for both
   the Causeway and the Second Link to Singapore to ease congestion
   and hardship of Malaysians and residents who travel on a daily
   basis. It will include an allocation of RM10 million to upgrade the
   Autogate Malaysia Automated Clearance System and M-Bike.

Strategy 8: Education for a Better Future

Mr Speaker Sir,

1. The only sustainable and guaranteed mechanism to achieve
   higher income growth is through better quality education at all
   levels. The Education Ministry remains the single largest recipient
   of Budget allocation at RM60.2 billion or 19.1% of the total Budget

2. The measures will include:

3. ONE: A total of RM2.9 billion will be provided to help students
   from lower income groups in terms of food, text books and cash
   assistance.

4. TWO: The Government has allocated RM652 million for the
   purposes of upgrading of schools, as compared to RM615 million
   allocated in 2018, as follows:
   • National Schools RM250 million
   • Chinese Schools (SJKC) RM50 million
   • Tamil Schools (SJKT) RM50 million
   • Full Boarding Schools RM50 million
   • Maktab Rendah Sains Mara RM50 million
   • Government Aided Religious Schools RM50 million
   • Mission Schools RM50 million
   • Tahfiz Schools RM50 million
   • Registered Religious Pondok Schools RM25 million
   • Conforming Schools RM15 million
   • Independent Chinese Secondary Schools RM12 million

5. THREE: All donations to national schools and public
   institutions of higher learning (IPTA) registered with the Ministry
   of Education for the purposes of upgrading infrastructure will be
   tax exempted starting 1 January 2019. This is to incentivise and
   recognise Malaysians who contribute directly towards nation
   building. For the other schools and institutions of higher learning
   registered with the Ministry of Education, the exemptions will be
   evaluated on a case-by-case basis.

6. FOUR: We will allocate RM100 million towards the reconstruction
   of dilapidated schools throughout the country, to be
   funded via competitively-tendered Public Private Partnership
   projects via land currently owned by the Ministry of Education.

7. FIVE: RM206 million will be allocated towards the
   development and provision of training programs in Polytechnics
   and Community Colleges.

8. SIX: We will also introduce a RM30 million the Training and
   Vocational Education and Training (TVET) Prestige Fund, a
   contestable fund where we will encourage the various training
   institutions to bid for funds to run competitive programs with
   specific KPIs on job placements for the graduates. There will also
   be an additional allocation of RM20 million to raise youth
   competency via a TVET sponsored Bootcamp.

9. SEVEN: Research funds amounting to RM400 million
   allocated will be allocated to our institutions of higher learning via
   a contestable fund. In addition, RM30 million will be disbursed in
   the form of matching grants via the Malaysia Partnerships and
   Alliances in Research (MyPAIR) program.

10. EIGHT: The Government will continue to provide
    scholarships and lending to all Malaysians via various Ministries
    and Agencies with a total allocation of RM3.8 billion. RM2 billion
    of this amount is allocated to provide scholarship for Bumiputeras
    under the sponsorship of MARA.

11. NINE: The Government will allocate RM17.5 million over the
    next 5 years to Malaysia Professional Accountancy Centre (MyPAC)
    to produce 600 qualified Bumiputeras accountants towards
    meeting the goal of 3,000 Bumiputera accountants registered with
    the Malaysia Institute of Accounts from the 1,554 today.

12. TEN: The Government will allocate RM210 million as part of
    the Bumiputera Empowerment Agenda to strengthen education
    and human capital development programs via Program Peneraju
    Tunas, Program Peneraju Skil dan Program Peneraju Profesional
    which will be managed by Yayasan Peneraju Pendidikan
    Bumiputera.

13. ELEVEN: To ensure the sustainability of the National Higher
    Education Loan Fund (PTPTN), we plan to introduce:
    • progressive loan repayment schedule with a percentage
    ranging from 2% to 15% of the borrowers’ monthly income
    depending on their income level. This repayment schedule
    will only apply to those with at least RM1,000 in monthly
    income;
    • tax relief for companies that help settle all the remaining
    loans of their employees for the year ending 2019;
    • additional individual tax relief for all additional savings
    deposited in the PTPTN National Education Savings
    Scheme (SSPN) from RM6,000 to RM8,000;
    • discounts on the loan will be given to students from B40
    households who have successfully obtained first class
    honours in their studies;
    • writing off the debt of those who are 60 years old and
    above with monthly income less than RM4,000, benefiting
    up to 350 debtors and costing RM4.2 million.

14. TWELVE: To instil good moral values and a strong sense of
    patriotism amongst our youth, a new program, PATRIOT will be
    introduced for youths aged 15 to 30 involving 70,000 participants
    a year with an allocation of RM70 million.

15. THIRTEEN: The Government congratulates all medal
    winners in the Asian and Asian Paralympic Games that have
    enhanced the good name of Malaysia and brought international
    goodwill. The Government is allocating RM100 million to prepare
    our athletes for the Tokyo Olympics 2020 in hopes of bringing back
    our first gold medal.

16. FOURTEEN: We will also allocate RM10 million for E-Sports
    to Malaysia Digital Economy Corporation (MDEC), recognising that
    this is an activity and industry which is increasingly popular
    among the younger generation involving software engineers and
    gaming developers.