Budget 2026’s RM470 billion public expenditure includes federal spending and catalytic investments by GLICs to support economic growth amid global uncertainties.
KUALA LUMPUR: The government has formulated Budget 2026 using a comprehensive fiscal approach covering federal operating and development expenditures plus catalytic investments by government-linked entities.
Finance Minister II Datuk Seri Amir Hamzah Azizan stated these entities include government-linked investment companies, government-linked companies, federal statutory bodies and Minister of Finance Incorporated companies.
“This approach optimises the nation’s resources under a coherent and unified direction, aligning with national priorities to ensure that economic impact and public well-being are maximised,” he said.
The budget’s total public expenditure of RM470 billion represents a more comprehensive picture as it includes RM50.8 billion in public investments by entities like Khazanah Nasional Bhd and Retirement Fund (Incorporated).
Amir Hamzah revealed the RM470 billion public expenditure for 2026 marks an increase from RM452 billion in 2025.
“The expansionary fiscal policy aims to support economic growth momentum, especially amid global economic uncertainties,” he said during the Dewan Rakyat debate on the Supply Bill 2026.
For parliamentary approval purposes, the total estimated Budget 2026 allocation is RM421.2 billion, comprising RM338.2 billion for operating expenses and RM83 billion for development expenditure.
Regarding development expenditure, Amir Hamzah emphasised the government remains committed to supporting growth through expansionary fiscal policy.
“The allocation for Basic DE projects in 2026 increased to RM57.6 billion or 71%, compared to RM55.67 billion or 65% in 2025,” he pointed out.
The 2026 development expenditure allocation for all states has increased compared to 2025 to ensure balanced and inclusive distribution.
He explained that the first year of the 13th Malaysia Plan typically focuses on project planning and approval, with 18.8% of the total five-year allocation allocated for 2026.
Amir Hamzah highlighted that with GDP projected to grow between 4.0 and 4.5% next year, the RM50.8 billion development allocation from public investments will continue driving national economic growth.
The parliamentary sitting will resume tomorrow. – Bernama
