PUTRAJAYA, Jan 8 — Putrajaya must amend its Budget for the year due to the unexpected economic downturn, Prime Minister Datuk Seri Najib Razak announced today, as the prolonged oil price slump continued to take sap government revenue.

Najib said he will table the revision soon, and that the changes would be more “realistic” to suit the present economic situation.

“To suit the present situation, I will announce some changes to the budget so that it can recalibrated to meet realistic expectations in line with the condition in 2016,” Najib told a meeting with staff of the Finance Ministry here this morning.

“But whatever it is, we keep in mind what is best for the people,” he added.

Najib announced a RM267 billion budget for 2016 in October, RM7 billion less than what his administration allocated for the previous year.

At the time of Budget 2016’s unveiling, oil price was hovering around US$40 a barrel and Putrajaya had based its projections on a US$48/barrel price.

It has since dropped to around US$30 a barrel.

Despite the necessity to revisit the Budget, however, Najib announced his intention to meet previously stated spending reforms.

“The government remains committed to reduce the deficit to 3.1 per cent of GDP, while government debt is still manageable at 55 per cent of GDP,” he said.

During his address to the ministry’s staff, Najib predicted that 2016 would be a challenging year.

But Putrajaya is expecting the economy to remain stable for 2016, with a projected growth of four to five per cent.

Inflation is expected to hover within the safe zone of two to three per cent, Najib said.

This is the second year in a row that Najib has been forced to revise the Budget, after oil price fell from US$110 to below US$50 last year and made it necessary to reduce Budget 2015 last January.