GEORGE TOWN, Sept 11 — Penang’s consolidated funds have shrunk over the years, from RM1.15 billion in 2019 to RM155.94 million at the end of 2024.
The state government is now focusing on rebuilding its finances after RM1.019 billion on social welfare and cash aid programmes between 2018 and 2025, Penang Chief Minister Chow Kon Yeow said today.
“This cannot continue or we won’t be able to pay salary so since last year, we are controlling our expenditure,” he said at a press conference at his office.
He said the funds were used for various initiatives, including cash aid under the Penang Lawan Covid-19 programme.
Despite the strain, Chow stressed that the state had not cut back on its annual welfare programmes.
“Instead, we are increasing our revenue,” he said, adding that the state will announce a review of assessment rates next week to boost income.
In November 2024, he tabled the state’s lowest-ever deficit budget for 2025, at RM33 million.
“We are optimistic to lower the deficit to single digit and even have a surplus,” he said.
Chow said the state aims to rebuild its consolidated funds to RM1 billion by 2028.
“If we have a surplus every year, we hope to restore the consolidated funds to RM1 billion by 2028,” he said.
He also noted that as of May 21 this year, the consolidated funds stood at RM235.55 million, an increase from RM155.94 million at the end of 2024.
Chow attributed the previous drop in reserves between 2020 and 2024 to continuous deficit budgets, which totalled RM998.88 million.
He said much of the spending went into social welfare and public transport programmes, including i-Sejahtera, incentives for taxi drivers and school bus operators, free Central Area Transit bus services, ferry and bus subsidies, and aid for groups such as teachers of supplementary Islamic religious classes, fishermen and trishaw riders.
