Federal Budget 2026 has been framed with a strong emphasis on citizen welfare and long-term economic sustainability, Finance Minister II Datuk Seri Amir Hamzah Azizan told the Dewan Negara during his winding-up speech on the Supply Bill 2026. The budget, which marks the fourth under the MADANI administration and the first aligned with the Thirteenth Malaysia Plan (RMK-13), allocates a total public expenditure of RM470 billion, comprising RM338.2 billion for operating costs and RM81 billion for development spending.
Amir explained that the budget continues the government’s effort to balance economic growth with social development, describing it as people-centric while maintaining disciplined fiscal management under the Economic MADANI framework. Key priorities include strengthening social protection, improving healthcare access, supporting small businesses, and ensuring sound governance.
He addressed concerns over subsidy reforms by highlighting the shift from blanket subsidies to targeted assistance, noting that this transition has generated savings of RM15.5 billion. These savings, he said, are being channelled back into programmes that directly benefit the rakyat. Among the major allocations are RM15 billion for Tunai Rahmah Contribution and Sumbangan Asas Rahmah, along with a one-off RM2 billion SARA incentive. Additional funding includes RM3.1 billion for welfare assistance, RM1 billion to ease cost-of-living pressures, RM794 million for back-to-school aid, and continued support for public transport users through My50 passes and BAS.MY concession cards.
On fuel subsidies, Amir said targeted initiatives under BUDI MADANI RON95 have been expanded to include thousands of fishermen and boat operators, particularly in Sabah and Sarawak, while safeguards remain in place to prevent subsidy leakage.
Economic resilience remains a central pillar of the budget, with strong backing for micro, small, and medium enterprises. A RM30 billion allocation under the Business Financing Guarantee Scheme is aimed at priority sectors such as Bumiputera businesses, high-tech industries, export-oriented firms, halal enterprises, tourism, and micro-financing. Complementary programmes, including Maju Usahawan MADANI 2.0 and iTEKAD, are expected to widen access to financing and entrepreneurial support.
The budget also addresses rising medical insurance costs through interim measures that cap premium adjustments for most policyholders, alongside a broader inter-agency effort to manage healthcare cost inflation. Protection for young Malaysians has been strengthened through initiatives to curb bankruptcy risks, debt stress, and online fraud, supported by expanded enforcement and public awareness efforts.
Amir reaffirmed that no new taxes will be introduced in 2026, while digital reforms such as e-Invoicing continue to enhance compliance without burdening small businesses. He also pointed to increased federal allocations for Sabah, sustained environmental conservation funding, and major investments in flood mitigation nationwide.
Following the conclusion of the debate, the Dewan Negara approved the Supply Bill 2026 by majority vote, formally endorsing the government’s spending plan for the year ahead.
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