KUALA LUMPUR: A new Bill was tabled in Parliament under which PETRONAS will no longer be the sole contributor to the National Trust Fund (KWAN).
Deputy Finance Minister Liew Chin Tong (pic) tabled the National Trust Fund Bill 2026 for its first reading in the Dewan Rakyat yesterday.
The Bill seeks to repeal the National Trust Fund Act 1988.
Under the proposed legislation, KWAN will be administered through the National Trust Fund (Incorporated), with the aim of ensuring the fund continues to be maintained and replenished after RM5bil was withdrawn to purchase Covid-19 vaccines during the pandemic.
The Bill also seeks to strengthen KWAN as a sustainable financial reserve for present and future generations of Malaysians.
As of Dec 31, 2024, the fund held net assets of RM22.43bil.
Under the existing Act, PETRONAS has been the fund’s sole contributor since its establishment in 1988, with contributions determined annually at the discretion of the board of directors.
Under the new Bill, the federal government will be required to contribute at least 0.1% of its projected annual revenue to the fund, while 2% of PETRONAS dividends will also be channelled into KWAN.
The federal government must contribute 2% of export duties collected from depleting natural resources such as crude oil, mineral ores and iron ore.
The Bill also limits annual withdrawals from KWAN to 50% of the fund’s expected long-term real investment return for the relevant financial year.
Should the Finance Minister determine that a larger withdrawal is necessary, a motion must first be tabled and approved by the Dewan Rakyat.
The government will transfer the required contributions to the fund at the end of each financial year. State governments may continue to make voluntary contributions from petroleum royalties.
The fund may also receive income from investments, as well as grants, donations, endowments, gifts, contributions and bequests.
Under Clause 24 of the Bill, the fund may only be used for expenditure relating to education, healthcare, and climate change mitigation and adaptation.
The proposed law also expands KWAN’s investment options to include bank deposits and gold deposits with banks, central banks or monetary authorities, as well as short-term money market instruments such as Treasury bills, bankers’ acceptances and certificates of deposit with maturities of up to one year.
The Bill also provides for the establishment of a board to oversee the administration and management of the National Trust Fund (Incorporated), including responsibility for investing the fund.
The Bill has been scheduled for its second and third readings within the current meeting of the Dewan Rakyat.
