Daim mulls setting up basic income fund
KUALA LUMPUR: A top adviser to Prime Minister Tun Dr Mahathir Mohamad is considering an overhaul to Malaysia’s social safety net by setting up a fund that pays out basic income to the poor.
Last year alone, the government spent RM37 billion on subsidies, aid and BR1M (1Malaysia People’s Aid), said Tun Daim Zainuddin, who leads the Council of Eminent Persons.
He said money could instead be channelled to the fund that would invest in assets, where returns were distributed as basic monthly income instead of one-time payouts.
“If we invest properly, I think there is sufficient income to take care of the needs of these people.”
Former prime minister Datuk Seri Najib Razak had come under criticism from then-opposition leaders, who said his pledges for bigger BR1M handouts were a way to win political support.
The new government under Dr Mahathir had said it would replace the programme with a costof-living aid.
More than seven million people have been approved to receive BR1M this year, amounting to RM6.12 billion of state spending, according to the Finance Ministry.
Dr Mahathir had said on Sunday that some handouts, including cash bonuses and paid Haj pilgrimages, might be scrapped as the government reforms its public aid system to ensure help goes only to those who need it.
“There is no point in saying high income when seven million of the people depend on BR1M,” said Daim.
“What we want is a developed nation status, where everyone can climb the social and economic ladder. This entails introducing policies that encourage businesses, while at the same time, ensuring the welfare of the people.”