PUTRAJAYA: The Kelantan government receives the highest amount of monetary aid from the Federal government, which goes towards helping it tackle its cash flow issues and pay its staff salaries.
Disclosing this on Saturday, Finance Minister Lim Guan Eng, in a statement, said that to date, the Federal government has so far paid out total of RM913 million to Kelantan in the form of financial deficit assistance and advance funds assistance.
The RM913 million, said Lim, is broken down into two categories, which included financial assistance to state governments whose operating account deficits meant they have insufficient funds in the state coffers to pay for operating expenditure such as emoluments or wages, rental and utility.
Under this category, the Kelantan government received a total of RM363 million from2013 to 2017. This, said Lim, was the highest of all the states in the country.
The remaining RM550 million, he said, was in the form of advance funds to Kelantan to assist the state with its cash flow problems.
The RM550 million, he added, came from a consolidated government fund to help states with cash flow problems, and noted that Kelantan was also the biggest recipient in this category.
Kelantan, he said, has yet to repay RM384 million from the RM550 million.
Lim said the Kelantan government is the only state which had recorded a deficit in its operating account for more than five years running.
“Without government aid, the state government would not be able to pay its staff emoluments.
“In 2017, only two states received financial deficit assistance, which were Kelantan and Perlis,” he said.
Lim has urged the Kelantan government to better manage its finances and increase its revenue in a professional and systematic manner. This, he said, was important in order to reduce the state’s dependency on the Federal government.
He said the responsibility lies with the Federal government to continue to improve the financial administration and ensure that state governments comply with existing financial procedures. © New Straits Times Press (M) Bhd