During the tabling of Budget 2024, Prime Minister Datuk Seri Anwar Ibrahim has said that targeted subsidies will be introduced in phases from next year onwards. These include subsidies for electricity and diesel. The savings will then be channelled to increase the cash aid given under the Rahmah Cash Aid scheme (STR), with the allocation increased from RM8 billion to RM10 billion in total.

According to the prime minister, the government will find ways to further improve the existing structure for providing electricity subsidy, which is currently already designed to offer it in a targeted manner. Under the existing arrangement, the government has abolished subsidies for the 10% of highest electricity users, while continuing to provide subsidy for the remaining 90% of users. With this, the government is already expected to save RM4.6 billion in electricity subsidy this year alone

Aside from that, the government has agreed to continue providing electricity rebates of up to RM40 per month for hardcore poor households, with an allocation of RM55 million. Additionally, the government also agreed to exempt the security deposit for homeowners who pay electricity bills that are under their own name.

As for diesel, selected users – such as logistic companies – will continue to be entitled to subsidised diesel, but other users will need to pay a higher price as the government restructures fuel subsidy. This is expected to reduce the impact on goods prices for the people.

Datuk Seri Anwar further said that all the savings gained via targeted subsidies will be channelled to improve the Rahmah Cash Aid scheme (STR). With this, the STR cash aid will be increased from RM3,100 to RM3,700 for eligible recipients. Youth recipients, too, will receive a cash aid of RM500, increased from the current RM350.

Moreover, the prime minister said that the first STR payment for eligible households will be increased from the usual RM300 to RM500, to be disbursed before the upcoming Ramadhan in February 2024. For context, the STR cash aid is usually staggered across a period of time for the recipients. The government will now also allow eligible individuals to apply for the STR cash aid whole year round, starting from as early as November 2023, as opposed to the current arrangement where they can only apply once a year, during a specific period.

Meanwhile, the Sumbangan Asas Rahmah (SARA) scheme that was just introduced this year – which offers an additional RM100 per month to 200,000 STR recipients (limited to six months) – will now also be expanded to benefit 700,000 recipients. On top of that, the RM100 cash aid will be provided for 12 months instead of just six months.

• TAGS:
• Blanket Subsidies
• Budget 2024
• Diesel Subsidy
• Electricity Subsidy
• Fuel Subsidy
• Government Subsidies
• Sumbangan Asas Rahmah (SARA)
• Sumbangan Tunai Rahmah
• Targeted Subsidies
• Targeted Subsidy Mechanism