State Budget already has provision of RM500 million Contingency Fund

Uggah (left) and Wong.

KUCHING, May 13: The State Financial Secretary’s (SFS) Office today clarified that there is no necessity to table the Contingency Fund for 2020 as the State Budget already has a provision/ceiling of RM500 million.

In a statement today, the SFS Office explained that this new provision/ceiling of RM500 million for Contingency Fund was reflected in the State 2019 unaudited financial statement.

“The provision/ceiling in the Contingency Fund can be increased from time to time by the State Legislative Assembly (DUN). Within the past 15 years, the provision/ceiling of the contingency fund had been revised five times.

“The last revision was made and approved by the DUN Sitting in November 2018, where the provision was increased from RM250 million to RM500 million effective from 2019,” the SFS Office said.

The SFS Office added that the fund was clearly stated in the 2019 Budget Speech tabled in the DUN Sitting in November 2018, where an additional appropriation of RM250 million was allocated for the Contingency Fund account.

It pointed out that DUN’s approval would only be required for (i) revision of the Contingency Fund provision/ceiling, and (ii) replenishment of Contingency Fund account via Supplementary Supply Bill to ensure the provision/ceiling remains intact.

The SFS Office elaborated that a Contingency Fund is one of the financial measures in public finance to manage financial resources mobilisation and expenditure.

“The Contingency Fund is created to meet urgent and unforeseen needs of expenditure of the government, for which no other provision exists.

“The Contingency Fund is constituted under Article 103 of the Federal Constitution and Section 11 of the Financial Procedure Act 1957 (Act 61),” the statement added.

Under this legal framework, SFS Office highlighted that the minister in charge with the responsibility for finance is authorised to make advances from the Contingency Fund for the above-said purposes.

“In addition, Section 3(3) of the Financial Procedure (Contingencies and Trust Funds) Ordinance, 1963 provides the Chief Minister with the authority to make advances from Contingency Fund to meet urgent and unforeseen needs for expenditure for which no other provision exists and for which money cannot be provided for under Section 15(4) of Financial Procedure Act 1957 (Act 61).”

This issue arose after Parti Sarawak Bersatu (PSB) president, who is a former finance minister, Datuk Seri Wong Soon Koh questioned whether the state government had the relevant Contingency Fund under Budget 2020 to support aid packages of more than RM2 billion rolled out in the wake of Movement Control Order (MCO).

Wong made the allegation following Second Finance Minister Datuk Amar Douglas Uggah Embas’ ministerial statement in the one-day DUN sitting on Monday (May 11) from which he was absent.

Uggah shot down Wong’s claims and insisted that there was the RM500 million Contingency Fund in the Sarawak 2020 Budget.

Uggah had also questioned why Wong did not attend the DUN sitting where he could have the oportunity to seek clarification on the matter.

Earlier today, Wong had backed his argument that there was clearly no contingency fund provided in Budget 2020 by providing two excerpts from the Ordinary Estimates of Budget 2019 and 2020 speeches. —DayakDaily