Terengganu executive councillor and PAS MP for Dungun, Mustafa Ali, denied news reports that he and Mentri Besar Abdul Hadi Awang, who is also MP for Marang, would quit as MPs.

Mustafa told malaysiakini this afternoon that the report was totally baseless and "100 per cent untrue". "We don't know where they pick this from," he said. "We are already very tired from fighting the general elections," he added. "How can we campaign for another two by-elections?"

Last Saturday, Malay newspaper Berita Harian reported on its front page that both Abdul Hadi and Mustafa Ali were to resign from their parliamentary seats in order to focus on state affairs.

The reports quoted sources saying that PAS intended to field Islamic scholar Harun Din as the candidate for Marang, while former International Islamic University lecturer Dr. Badrul Amin would be the replacement candidate in Dungun.

According to the report, the resignations were also meant to increase the strength of the ulama in PAS at the federal level.

Speculation on the resignations gather pace yesterday when Abdul Hadi and Mustafa were the only Opposition members failed to turn up for the first parliamentary sitting. However, sources in PAS said that this was because the two were busy preparing for the tabling of the state budget.

The state budget, which was announced today, projected a surplus of RM8.475 million or 1.22 per cent over the anticipated revenue.

Abdul Hadi, who presented the budget at the State Legislative Assembly, said petroleum and gas royalties were the largest single source of state revenue for the current year, totalling RM530 million.

"Terengganu's economic prospects for 2000 indicate a 5.3 per cent growth," he said.

Abdul Hadi added that since the state was saddled with a debt of RM731 million from the previous BN government, his government would set up a board to review Terengganu's administrative system. This include streamlining the roles and functions of its statutory bodies in order to save expenditure.

Apart from that, the government would also reopen the application for land for residential and economic purposes, especially to ensure that each family has a housing lot.