9th October 2026 - 2 min read
Prime Minister Datuk Seri Anwar Ibrahim has tabled a total allocation of RM510 billion for Budget 2027, up from RM470 billion for Budget 2026. Anwar said the budget, the fifth under the MADANI government, continues an expansionary fiscal policy.
Federal operating and development spending make up RM459.8 billion of the total. The rest comes from investment by government-linked investment companies (GLICs), public-private projects, statutory bodies and Minister of Finance Incorporated (MKD) companies.
| Component | Allocation |
|---|---|
| Federal operating expenditure | RM376.8 billion |
| Federal development expenditure | RM83 billion |
| GLIC investment | RM25 billion |
| Public-private investment | RM11 billion |
| Federal statutory bodies and MKD companies | RM14.2 billion |
| Total | RM510 billion |
Federal revenue for 2026 is now projected at RM363.6 billion, higher than the original estimate of RM343.1 billion. For 2027, the government expects revenue to rise further to RM380.8 billion, an increase of RM17.2 billion.
Anwar said the crisis in West Asia raised fuel subsidies to RM40 billion this year. As a result, the 2026 fiscal deficit is now projected at 3.6% of GDP, slightly above the original target of 3.5%.
He added that the deficit remains on a downward trend, from 5.5% in 2022 and 3.7% last year. The government expects it to fall to 3.3% in 2027, with a target of 3% by 2028. Along with controlled new borrowing, this is expected to bring federal government debt down from 65.2% of GDP in 2025 to 64.0% in 2026 and 63.7% in 2027.
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Christina writes about personal finance with an eye for making the complicated feel straightforward. She is drawn to the everyday money decisions people face and genuinely enjoys finding the clearest way to explain them. Between articles, she is probably napping, on a hiking trail, or terrorising her sister’s cats.
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