PETALING JAYA: The true measure of the national spending plan lies in how it benefits the people, not in the size of its allocation or the thickness of a document, says Prime Minister Datuk Seri Anwar Ibrahim.
“Its true measure is far more fundamental. It is whether more people can live with dignity, and whether the Malaysia we eventually pass on to the next generation will be fairer than the Malaysia we inherited.
“If the answer is yes, then that is genuine transformation and progress,” he added as he tabled the government’s largest budget on record.
A total of RM510bil has been allocated under the government’s national spending plan for 2027.
“The fifth Madani budget continues an expansionary fiscal policy, mobilising the full strength of the nation, with total expenditure and investment amounting to RM510bil, compared with RM470bil previously,” he said in his budget speech in the Dewan Rakyat.
A total of RM376.8bil has been allocated for operating expenditure while RM83bil will go into development expenditure.
Aside from that, RM25bil will come in the form of investments by Government-Linked Investment Companies (GLICs); RM11bil in public-private investment; and RM14.2bil in investments by federal statutory bodies and companies under the Minister of Finance Incorporated (MOF Inc.).
Anwar said the government has projected higher revenue in its coffers for 2026.
This trend is expected to continue into next year.
“This year, federal revenue is projected to be higher, at RM363.6bil, compared with the original estimate of RM343.1bil. Next year, revenue is expected to continue rising to RM380.8bil.”
He said the Middle East crisis has also increased fuel subsidies cost to RM40bil.
“The fiscal deficit for 2026 is now projected at 3.6%, compared with the original target of 3.5%,” he said.
“Nevertheless, the deficit remains on a downward trajectory, falling from 5.5% in 2022 to 3.7% last year.”
However, Anwar hopes the deficit will narrow further to 3.3% in 2027 and subsequently to 3% by 2028.
He said the government has reduced the deficit by controlling new borrowings. Therefore the government’s debt-to-GDP ratio has declined steadily, from 65.2% in 2025 to 64% in 2026, and is expected to fall further to 63.7% in 2027.
Describing Budget 2027 as a national commitment to the future, Anwar said economic strength must translate into better lives for Malaysians.
He said economic growth must be inclusive, while reforms should help restore confidence.
“Today, these are the tests and challenges we face. The world is becoming increasingly turbulent.
“Wars, rivalry between major powers and climate change are affecting food prices and energy costs.
“Supply chains that we have long regarded as robust are beginning to fray and weaken, putting food security and the reliability of supplies to the test.
“Developments in artificial intelligence are rapidly transforming trade, energy, employment and our daily lives,” he said.
However, Anwar added that major changes also presented opportunities for countries that were prepared to adapt, develop new capabilities and equip their people with the necessary skills.
He said Malaysia should not merely cope with these changes, but take advantage of emerging opportunities.
