Budget 2017 – All about Targeted Subsidy

Preparing the budget has been described by Prime Minister Datuk Seri Najib Tun Razak as managing the finances of the family to meet its household needs. As a “sensible father”, the Prime Minister, who is also the Finance Minister, said one of the strategic thrusts of Budget 2017 was to address the issue of the rising cost of living and affording housing.

This includes replacing the inefficient bulk subsidy system with targeted subsidy, with the objective of it benefiting those who are really in need, particularly the Bottom 40 (B40) of the population. This referes to the bottom 40% of households with a monthly income of RM3,900 and below.

The Malaysia population, in general, can be divided into three economic categories, namely, the high-income group or T20, the middle-income group or M40, and B40. The focus is on helping those deemed as the most vulnerable, and Budget 2017 is not intended to benefit any particular group or race but the population at large.

An estimated 7 million people, about a fifth of the country’s population, will benefits from the increased BR1M allocation for 2017


MyBeautiful New Home (RM200mil)
5,000 units of up to RM50,000 each. Government to provide financing of up to RM20,000 each.

Program Perumahan Rakyat (RM710mil)
20,000 new units, each costing between RM35,000 to RM40,000 depending on location.

Rumah Mesra Rakyat (RM200mil) by Syarikat Perumahan Negera Bhd
5,000 new units. Government subsidy up to RM20,000 each.

Rumah Transit 1Malaysia
10,000 units for young newlywed to rent at below market rates.

Rumah Generasi Kedua (RM400mil)
> Felda (RM200mil)
> Felcra (RM100mil)
> Risda (RM100mil)

Home Ownership Programme
GLC to build 30,000 new homes on strategic Government land, priced between RM150,000 and RM300,000 each.

PR1MA step up financing
– Special financing packages.
– Government guarantee of up to RM100,000, savings in borrowers’ EPF account two “ring fenced”.
– Low initial loan installments

Stamp duty exemption
For first time home buyers below RM500,000.

Targeted measures to keep food and fuel prices stable
– Padi farmers – RM1.3bil
– Fishermen – RM250mil
– Toll & Transportation – RM885mil
– Rubber smallholders – RM510mil
– Interest Rate – RM2.4bil
– Petrol, gas, cooking oil & Electricity – RM4.2bil

– Solar Panel installation at 1,600 homes
– Participants to receive monthly payment of RM250 each.

– Participants will receive up to RM10,000 each for motorbikes, tools and equipment.

– Participants will be given free training.
– Government to provide RM100mil

Ride Sharing
– Targeted at BR1M receipients
– Rebates of up to RM4,000 to purchase Proton Iriz.

Incentives for Taxi Drivers
– RM5,000 for taxi drivers seeking to buy own vehicle
– Perkeso scheme

eRezeki & eUsahawan
– To help micro entrepreneurs exploit the use of digital technology.

– RM100mil – 97,000 street lights and 3,000 LED lights in rural areas.
– RM4.6bil – State road maintenance
– RM1.2bil – To upgrade 616km of rural roads and bridges
– RM350mil – To repair 17,000 homes in rural areas
– RM1.9bil – Clean water supply projects
– RM460mil – Rural electrification projects
– RM300mil – 1Malaysia Maintenance Fund (TP1M)
– RM800mil – Rural infrastructure upgrades
– RM495mil – Flood mitigation projects