KUALA LUMPUR, Sept 2 — The Ministry of Finance (MoF) has denied placing any restrictions or freezes on allocations for rural road projects under the Ministry of Rural and Regional Development (KKDW), clarifying that payment delays to contractors stem from the ministry consistently overspending its approved annual budgets over recent years.
In an official statement released today, Treasury Secretary-General Datuk Johan Mahmood Merican emphasized that each government ministry is responsible for managing its expenditure within the annual budget limits approved by Parliament. He affirmed that all funds allocated for KKDW’s rural road developments have been fully disbursed.
“There have been no restrictions placed on the allocation for the Ministry of Rural and Regional Development regarding rural roads. The allocation has been fully channeled,” Johan said. “Payment constraints to contractors arose because the current year’s allocation was almost entirely spent.”
Financial data provided by the Treasury demonstrates that KKDW has continuously committed and expended funds beyond its parliamentary budget approvals for rural road infrastructure:
| Year | Approved Budget (RM billion) | Actual Expenditure (RM billion) |
| 2022 | 1.1 | 1.1 |
| 2023 | 1.1 | 1.8 |
| 2024 | 1.3 | 2.0 |
| 2025 | 1.6 | 2.3 |
| 2026 | 2.1 | 1.9* (as of June 2026) |
To address the immediate liquidity bottleneck and settle outstanding contractor payments, MoF has approved an additional RM300 million allocation for KKDW for the 2026 fiscal year.
Furthermore, MoF is working closely with KKDW to reprioritize ongoing projects while actively identifying savings across other ministries to absorb KKDW’s excess financial commitments.
–NMT
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