The diesel subsidy rationalization program, also known as Budi Madani Diesel (Budi Diesel), has saved the Malaysian government about RM5 billion annually since its implementation on June 10, 2024, the Ministry of Finance said, according to a Named report.
In addition to reducing pressure on the country’s fiscal position, the savings allow funds to be redirected to more productive purposes, including strengthening the people’s social safety net, the ministry said yesterday in a written response to Rompin MP Abdul Khalib Abdullah, who wanted to know how effective the targeted petrol and diesel subsidies have been in reducing leakages and alleviating of Malaysia’s fiscal burden.
“One of the proactive measures taken by the government is to improve cash assistance, such as Rahmah cash donation (STR) and Contribution from the Rahmah Foundation (SARA) by increasing the allocation to RM13 billion under the 2025 Budget, up from RM10 billion in the previous year, and further to RM15 billion through the SARA Appreciation initiative. The savings are also used to finance development projects that can increase the country’s productive capacity,” the report said.
Also, over 140,000 recipients in the Budi Individual category and 180,000 recipients in the Budi Agri-Komoditi category have been approved, with total payouts of RM430 million and RM350 million respectively. As of September 30, diesel fleet cards (which unlock diesel at RM2.15 per litre) have been approved for 355,074 vehicles under 121,618 companies.
As of 4pm on Oct 8, more than 10 million of the 16 million eligible Malaysians (62.5%) have purchased 365.7 million liters of RON 95 petrol at the subsidized RM1.99 per liter (RM727.7 million in total) since Budi Madani RON 95 (Budi95) started on September 27 for police and military personnel. The latest figures are 12.4/16.5 million Malaysians (75%) and 930 million liters (RM1.85 billion) as of Oct 21. We are approaching the first full month of Budi95.
Meanwhile, the Ministry of Economy said in the same written response that the Central Database Hub (PADU) is one of the main reference databases for Budi95 validation by the Ministry of Finance. “Based on the available data, the government can identify socio-economic intervention programs for specific target groups. In this regard, PADU can be used as a reference database by the relevant government agencies.”
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