PARLIAMENT | The bipartisan Parliamentary Select Committee on the Budget has affirmed that the national debt stood at RM1,090.8 billion (RM1.09 trillion) as of end-2018.
The PSC said that apart from the direct debt of RM741 billion, off-budget financial obligations such as public-private partnership, PFI trust accounts, Pembinaan BLT Sdn Bhd and government guarantees must also be added into the debt calculation.
"This is because there is no difference (between these projects) and development projects directly financed by the government under the five-year Malaysia plans through borrowings from domestic or international lenders," read the committee's Government Debt and Liabilities Report, which was released today.
The PSC said that it was important for the government to paint an accurate picture of its finances to accurately prepare for the debt service charges.
The PSC recommended that the government incorporate off-budget items into the national budget and enact laws on the maximum amount of government guarantees that the government can undertake.
They also recommended that the government regularly compare its debt levels with Asean countries and developed nations.
Committee chairperson Mustapa Mohamed told reporters later that the federal government had adopted accrual accounting in 2011, in line with the International Monetary Fund's guide on public sector debt statistics.
The government began the process of migrating from cash-based accounting to accrual accounting in 2015, which would be completed in a year or two, he said.
Accrual accounting takes into account total assets and liabilities, including future liabilities, compared with cash-based accounting which only looks at transactions.
"The difference between then and now is that the committee has decided that we need to take liabilities into account as the government is obliged to pay," he added.
Apart from Mustapa, the other PSC members are Nik Nazmi Nik Ahmad (Harapan-Setiawangsa), Tan Yee Kew (Harapan-Wangsa Maju), Dr Kelvin Yii (Harapan-Bandar Kuching), Khoo Poay Tiong (Harapan-Kota Melaka), Khairy Jamaluddin (BN-Rembau) and Alexander Nanta Linggi (GPS-Kapit).