Kota Kinabalu: Liberal Democratic Party (LDP) President Datuk Chin Su Phin said the wage policies in Budget 2027 represented a significant step towards raising household incomes nationwide.
However, he warned that Sabah risked failing to capitalise on the increased federal allocation unless long-standing administrative bottlenecks affecting project delivery were urgently addressed.
Chin said the budget struck a balance between raising baseline wages and giving smaller enterprises room to adjust, highlighting the planned increase in the minimum wage from RM1,700 to RM2,000 effective June 2027 as one of its key announcements.
He said micro, small and medium enterprises with annual turnover below RM50 million would be exempted from the new minimum-wage requirement, describing the provision as pragmatic support for vulnerable local businesses.
He also welcomed the proposed starting minimum wage of RM2,500 for semi-skilled workers and graduates, alongside a commitment by government-linked investment and commercial firms to raise the monthly living-wage benchmark from RM3,100 to RM3,400.
Pay scales should better reflect qualifications, skills and productivity, he said.
Chin also highlighted fiscal measures, including a one-percentage-point income tax cut for certain middle-income earners and small and medium enterprises, as well as an increase in basic individual tax relief from RM9,000 to RM12,000.
He said these measures could ease the financial burden on middle-income households facing housing loans, vehicle payments, insurance, education and healthcare costs.
Meanwhile, cash assistance programmes such as Sumbangan Tunai Rahmah and Sumbangan Asas Rahmah would continue to provide support for lower-income groups.
On Sabah’s development, Chin noted that the federal allocation for the State would increase to RM18.7 billion in 2027 from RM17.6 billion this year, with funding intended for roads, water supply, electricity infrastructure, healthcare facilities, schools and rural development.
He also welcomed the Federal Government’s recognition of the Malaysia Agreement 1963 (MA63), saying it should lead to practical negotiated outcomes rather than remain a political catchphrase.
However, Chin said effective implementation remained the main challenge, pointing to poor coordination among agencies, slow approvals and administrative hurdles that had delayed projects in Sabah in previous years.
“Money being allocated means little if it does not translate quickly into roads, utilities, public facilities and real-world opportunities; when delivery stalls, ordinary Sabahans are the ones who lose out,” he said.
He urged federal and state governments, along with implementing agencies, to resolve procedural obstacles promptly to ensure the increased allocation delivered its intended benefits.
While acknowledging that no single budget could resolve every socioeconomic challenge overnight, Chin described Budget 2027 as a well-directed package covering wages, tax relief, business support and assistance for vulnerable households.
“Now the Prime Minister has set the direction. Success depends on efficient joint-work by federal and state leaders plus the civil service to ensure these policies reach our families, enterprises and communities,” he said.
