PUTRAJAYA, Feb 27 — Prime Minister Datuk Seri Anwar Ibrahim defended today his administration’s decision not to give civil servants a pay raise, saying the move was necessary to reduce Malaysia’s growing debt and channel more funds into programmes for the poor.

Cuepacs, the union representing lower grade civil servants, said last Friday it was disappointed that Anwar did not heed its call to increase salaries to help them cope with the cost of living squeeze in an immediate response to the revised Budget 2023.

"What they want is a salary bump and I agreed in principle,” Anwar told reporters after speaking at an international conference to address Islamophobia here.

"But I have explained the issue. Now what is the issue? Government debt is RM1 trillion... if we raise their pay the deficit will be 65 per cent. By then no investors will invest here because they aren't confident with the way we manage our finances,” he added.

"But I have explained the issue. Now what is the issue? Government debt is RM1 trillion... if we raise their pay the deficit will be 65 per cent. By then no investors will invest here because they aren't confident with the way we manage our finances,” he added.

Cuepacs has also come under criticism for pushing the pay rise again.

Emolument for the civil service alone takes up close to a fourth of operating expenditure under Budget 2023, the biggest allocation by component.

Still, this year's operating expenditure is smaller than the one tabled last October but was not passed as Parliament was dissolved days later to pave the way for the 15th general election.

The Anwar administration made cuts into its operational spending and channelled some of it for development spending, at over RM90 billion, by far the largest.

Anwar said Cuepacs should understand that those cuts were important to help the government spend on programmes for the poor.

He admitted that not raising salaries for the civil service could affect his leadership politically.

"Be patient. If there is excess in revenue I will disburse it,” he said.

"It is not important that we help the hardcore poor who are in a much worse off state than civil servants? Yes, I understand that it would be politically problematic but think about the farmers, fishermen and those who are in absolute poverty.

"Do they not need help too?” he asked.