KUALA LUMPUR, Oct 10 — The Finance Ministry is committed to taking progressive steps to improve Malaysia’s fiscal policy in Budget 2024 to reduce poverty and inequality in the nation.
Treasury Secretary-General Datuk Johan Mahmood Merican said: “It was a surprise to hear (the) fiscal policy currently has (a) relatively small impact on poverty.”
“We are very proud of our track record in reducing poverty. During Independence (in 1957), it was 50 per cent. Now (it is) closer to six per cent,” he said at the launch of the 28th World Bank Malaysia Economic Monitor Report Raising the Tide, Lifting All Boats today.
Johan said the Sumbangan Tunai Rahmah (STR) initiative would also be looked into to be further improvised to benefit the lower end of B20.
“Our STR alternately benefits 12 million adults, which is 60 per cent of the population, so it is B60 rather than B40 cash transfer, but there is room to make it more progressive so the fiscal policy can be more progressive,” he said.
Meanwhile, Malaysia Economic Monitor (October 2023) said: “Despite a long-term declining trend, income inequality in Malaysia remains relatively high compared to regional and transitional peers and high-income countries.
“Income poverty in Malaysia is well below 10 per cent, reflecting Malaysia’s decades’ long record of growth and development, although the remaining poor are harder to reach and poverty reduction had been slowing even before Covid-19 increased it,” the report said.
It added that Malaysia’s Gini Coefficient Index is also “higher than most Asean countries, those that have recently become high income, and Organization for Economic Cooperation and Development (OECD) countries.”
— Bernama
