There is no clear sign what the new Anwar Ibrahim government’s next steps will be about a Malaysia-EU FTA, but indications are positive. Photo: AFP / Syaiful Redzuan / Anadolu Agency

SINGAPORE – With his political survival on the line, Malaysian Prime Minister Muhyiddin Yassin overcame a key hurdle when lawmakers approved on November 26 his government’s expansionary 2021 budget, the first in a series of votes that will ultimately determine whether the spending plan is passed.  

By failing to seize a golden opportunity to put the spending bill through a formal count in Parliament, opposition leader Anwar Ibrahim dismayed his supporters and had little to show for his oft-repeated claims of commanding the parliamentary numbers needed to bring down Muhyiddin’s nine-month-old government.

Passage of the 322.5 billion ringgit (US$78 billion) annual budget, the nation’s largest-ever at 20.6% of gross domestic product (GDP), had been in question with legislators on both sides of the aisle – including those within the premier’s ruling Perikatan Nasional (PN) administration and its allies – voicing opposition to various components of the spending proposal.  

Pitched as essential to the nation’s post-pandemic economic recovery, the budget ultimately passed in a voice vote in the policy stage of the voting process. Prior to its approval, Finance Minister Tengku Zafrul Abdul Aziz announced last-minute concessions aimed at meeting certain government backbencher demands.

Lawmakers from the United Malays National Organization (UMNO), the largest party within the ruling PN coalition, had publicly threatened to defeat the budget if the government failed to extend a loan moratorium for lower-income earners and small businesses and permit higher withdrawals from federal retirement savings as a form of economic aid.

Opposition lawmakers, despite objecting to the budget since its tabling on November 6, opted not to dispute its approval when only 13 out of a minimum required 15 legislators stepped forward to support a bloc vote, a result that initially left many puzzled and speculating whether a backroom deal had been reached to ensure the bill’s passage.

A bloc vote would have required all lawmakers to have their votes formally counted, revealing the total number of those supporting Muhyiddin, 73, who at last count commanded a slim two-seat majority of 113 of 222 parliament seats. Anwar, 73, disputes the premier’s legitimacy and has claimed without evidence that he has a legislative majority.

“Muhyiddin may thus claim to have won round one of the budget battle, albeit under the unusual circumstance of the opposition essentially having unexpectedly not mounted a serious battle at the last moment,” said Oh Ei Sun, a senior fellow at the Singapore Institute of International Affairs (SIIA).

Malaysia’s Finance Minister Tengku Zafrul Tengku Abdul Aziz delivers a speech on the national 2021 budget at the Parliament in Kuala Lumpur. Photo: AFP/Famer Roheni/Malaysia Department of Information

“It is incumbent upon the opposition to provide a sensible explanation for their seemingly bizarre, capitulating voting behavior, failing which they would be widely perceived as having acquiesced to Muhyiddin’s continuing leadership, a perception that would hurt both their immediate prospect for replacing him as well as their longer-term electoral chances.”

By waiving their right to oppose the budget, divisions within Anwar’s Pakatan Harapan (PH) and the broader opposition camp have been brought to the fore, prompting demands for answers by opposition politicians and supporters who took to social media to question what was behind the budgetary about-face.

Malaysiakini, a local news website, reported that PH lawmakers said they received eleventh-hour instructions from Anwar not to push for a bloc vote after he purportedly received indications that rebel UMNO backbenchers were no longer prepared to oppose the bill after the government partially agreed to measures that met their various demands.

According to the report, Anwar opted for a change of procedural strategy not to reveal PH’s numbers because going ahead with a bloc vote risked Muhyiddin being able to prove his narrow majority support, in effect allowing him to demonstrate his legitimacy as premier and putting to rest Anwar’s unproven rival claim.

Not all PH lawmakers were on board with Anwar’s strategy, with at least one legislator from Anwar’s Parti Keadilan Rakyat (PKR), one from the Democratic Action Party (DAP), and six from Parti Amanah Negara (Amanah) breaking ranks in support of a bloc vote, which would have been equivalent to a no-confidence vote in Muhyiddin’s leadership.

Former premier Mahathir Mohamad, 95, and three other lawmakers from Parti Pejuang Tanah Air (Pejuang), a splinter opposition party that broke away from Muhyiddin’s Parti Pribumi Bersatu Malaysia (Bersatu) earlier this year and is not aligned with PH, were among those who stood for a bloc vote in a bid to defeat the budget.

In an online blog post, Mahathir, who resigned as premier in February, chastized opposition lawmakers for allowing the budget to pass “without a shred of remorse for breaking [their] promise to the people” and described the government as one that is “propped up by bribes and gratification” and run by “those who have no principles.”

Two-time Malaysian Prime Minister and now opposition politician Mahathir Mohamad in a file photo. Image: AFP

Anwar, in remarks made to reporters, admitted he appealed to Amanah and DAP leaders not to proceed with a bloc vote because he did not want to be seen as rejecting new concessions announced by the finance minister, which he said failed to address PH’s core issues with the spending bill but “could be more acceptable” to the public.

Khalid Samad, an Amanah lawmaker who was among the 13 who attempted to force a bloc vote, acknowledged at a press conference that there were concerns within PH about “how we would be perceived if we decided to oppose the budget, which would mean Malaysians wouldn’t get the sweets the finance minister was tossing up.”

He reportedly claimed Amanah lawmakers were not informed that PH legislators had been told to stand down from opposing the spending plan, and denied that the debacle was evidence of a rift within the opposition coalition. But there are indications that Anwar’s last-minute change of strategy did not sit well with DAP and Amanah leaders.

Tempers reportedly flared at a two-hour meeting held by PH leaders after the budget vote. “Anwar’s decision had put everyone in a very difficult position,” said one PH source cited by Malaysiakini. The PKR president told the media he did not rule out pushing for a bloc vote when the budget proceeds to the so-called committee stage of deliberations.

The budget can still technically be defeated in upcoming debates in the committee stage, where the allocations for each ministry will be scrutinized and legislators will have the opportunity to call for bloc voting again. But analysts see the budget’s initial passage as shoring up Muhyiddin’s continued hold on the premiership in the near-term.

“Muhyiddin was always going to modify the budget to keep some of the key UMNO people happy,” said James Chin, inaugural director of the University of Tasmania’s Asia Institute. “[PH] is already trying to block some sections of the budget. But I expect the modified budget will get through Parliament by the end of next week, and Muhyiddin will survive.”

Should the budget be defeated in the committee stage, it would imply a loss of confidence in the prime minister’s leadership and, according to Westminster convention, should result in Muhyiddin’s resignation and the likely appointment of a caretaker prime minister by Malaysia’s constitutional monarch, the Yang di-Pertuan Agong.

Some constitutional experts argue that Muhyiddin wouldn’t be legally obliged to follow convention by resigning, and could instead table a new budget. Constitutional constraints would, in any case, prevent the government from being able to access funds for its 2021 expenditure because Parliament is required to authorize practically any withdrawal.

Muhyiddin extended a message of thanks to lawmakers who supported the budget’s provisional approval, which he said was proof that an earlier decree by the Agong, who in a rare precedent called on all politicians to put aside disputes to ensure the budget’s passage in light of the health and economic crises facing the nation, had been heeded.

Malaysia‘s Prime Minister Muhyiddin Yassin arrives at a mosque in Putrajaya for prayers in August. Photo: Agencies

The 61-year-old king, Sultan Abdullah Sultan Ahmad Shah, has played a larger political role since the fall of the short-lived PH government in February and similarly expressed gratitude to lawmakers for passing the budget, which he said would safeguard Malaysians’ well-being amid the ongoing coronavirus pandemic and enable economic recovery.  

The budget increases spending by 2.5% from the 2020 budget despite a deficit crunch and lower crude oil-related state revenue. It includes a special 20 billion ringgit ($4.83 billion) Covid-19 fund that will increase spending on protective gear for frontline workers and sets aside an estimated 3 billion ringgit ($736 million) for vaccine purchases.

Some lawmakers are said to have been wary of obstructing the budget as the nation grapples to stem the rising tally of Covid-19 infections, with cumulative cases swelling by over four-fold since September to over 60,000. Defying a royal request by opposing the budget would have been seen as audacious and rife with risks of a public backlash.

In the vote’s lead-up, attention had been more focused on cracks within UMNO rather than potential fault lines within the opposition, with the former’s expressed frustrations with Muhyiddin’s leadership and angst over the perceived as lopsided distribution of power and positions within the Cabinet threatening an intra-government schism.

UMNO leaders upset with playing second fiddle to Muhyiddin’s smaller Bersatu party piled pressure on the premier after Malaysia’s king rejected his request to declare emergency rule in October, seen by analysts as a gambit to consolidate power and a pathway to approving the budget outside of the usual legislative process to avoid a test of his majority.

Though lawmakers from the former ruling party chose not to defeat the spending bill, analysts say that doesn’t mean an end to the infighting now roiling the PN coalition. Many had expected that Muhyiddin would announce a Cabinet reshuffle that would see more UMNO ministers appointed to more prominent positions, though that has yet to occur.

Analyst Oh of SIIA believes internal friction within PN will continue to threaten Muhyiddin’s fragile premiership “as long as UMNO’s ambitious thirst to truly steer the leadership of the ruling coalition is not somehow at least partially quenched, for example by offering them more political and other sort of perks.”

At the moment, though, Malaysia’s opposition leaders are reeling from the political fallout of having symbolically given up without a fight after weeks of signaling they would use the budget vote to deal a possibly fatal blow to Muhyiddin’s royally-appointed administration.

A man walks past a mural wall painting in Kuala Lumpur, Malaysia on March 28, 2020. Photo: EyePress Newswire/FL Wong/AFP Forum

The budgetary blunder has hurt Anwar’s credibility in particular, all the more so after the wheels came off an attempted takeover bid he triggered in September by claiming to command support from a “solid and convincing majority” of lawmakers in Parliament, an assertion that Malaysia’s king disputed in a devastating monarchal snub.

Whatever the official rationale for the opposition’s eleventh-hour stance on the budget, observers say the true prerogative was avoiding a bloc vote that PH would have likely lost without UMNO backbencher support. It remains to be seen whether the opposition will change course and push forward with a vote count in Parliament in the days ahead.

“There is still a long and potentially arduous way as the budget makes it through the committee stage littered with political potholes and covered with plausible potshots from both within the ruling coalition and from across the parliamentary divide, before proceeding for a final vote which may or may not yield a similar result,” said Oh.