KUALA LUMPUR – The government’s subsidy rationalisation has resulted in annual savings of approximately RM15.5 billion, Prime Minister Datuk Seri Anwar Ibrahim revealed.
Presenting the 2026 Budget in the Dewan Rakyat today, he explained that each ringgit saved allows for greater investment in welfare, cost-of-living support, and public infrastructure.
“All previous governments have acknowledged the need for targeted subsidies, but they were delayed due to a lack of strong political will,” he said.
“Subsidies are a privilege for Malaysians, not for foreigners or large corporations. The government is ensuring that subsidies are properly targeted to ensure public funds reach the people,” he added.
Among the measures implemented, Anwar highlighted the liberalisation of chicken and egg prices, saving RM1 billion each while maintaining controlled prices for poultry. Additionally, the rationalisation of electricity subsidies and tariff restructuring resulted in average savings of RM6 billion. Notably, 85 per cent of consumers were unaffected by tariff increases, with some even benefiting from lower bills.
Furthermore, Anwar, who also serves as Finance Minister, said that the rationalisation of diesel subsidies has saved RM5 billion. Public transport, the fishing industry, and specific logistics sectors continue to receive subsidised diesel, while individual vehicle owners, farmers, and smallholders are provided RM200 in monthly aid.
The rationalisation of the RON95 petrol subsidy (BUDI95) is expected to save at least RM2.5 billion, allowing Malaysians to purchase RON95 at RM1.99 per litre.
“The implementation of BUDI95 has been smooth, with more than 10 million Malaysians benefiting from RON95 at RM1.99 per litre. The database of 16.5 million eligible citizens is being updated, which will extend additional quotas to 23,000 registered boat owners and over 52,000 active e-hailing drivers,” Anwar said.
He stressed that rationalising subsidies was essential, as blanket subsidies had historically benefitted foreign nationals and large corporations, rather than the intended Malaysian citizens.
“This rationalisation has also enabled us to ease the people’s burden through initiatives such as the ‘SARA Untuk Semua’ programme, launched in August,” he concluded. – October 10, 2025