"Raising The Floor" — Here's How Budget 2025 Intends To Increase Wages & Living Standards
At the heart of Budget 2025 is helping the rakyat who need it the most.
By Jeremy Ng — 10 Dec 2024, 03:02 PM
On 18 October, Prime Minister Anwar Ibrahim presented Budget 2025, focusing on three key areas — raising the ceiling, raising the floor, and refining public systems
At the heart of this year's budget is helping the rakyat who need it the most. And the emphasis on 'raising the floor' ensures meaningful support for everyday needs, from higher wages to financial assistance for vulnerable communities.
Diving in deeper, Budget 2025 has been designed to raise the floor for everyday Malaysians in a tangible way, offering practical and immediate assistance to those who need it most
One of the key initiatives is raising the minimum wage from RM1,500 to RM1,700 starting 1 February 2025, boosting disposable income. This measure is expected to stimulate the local economy through higher spending, which will benefit small and medium-sized enterprises (SMEs).
Budget 2025 also increased allocations for Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) cash aid from RM10 billion to RM13 billion. These programmes will provide direct cash assistance to the most vulnerable groups, including the elderly, single parents, and people with disabilities.
There are also social mobility initiatives like Inisiatif Pendapatan Rakyat (IPR), which equips Malaysians with skills and platforms to succeed by running their own vending machine business.
“Each week, I spend around RM150 to RM200 on supplies, earning a net monthly income of between RM1,000 and RM1,500. This initiative has been very helpful in meeting my children’s daily expenses and supporting my husband,” said one of the IPR vending machine operators, in an interview with the New Straits Times.
Beyond that, Budget 2025 also strives to protect the rakyat by placing safeguards to curb inflation and the rising cost of living
To address rising living costs, the government has expanded its financial support programmes, including targeted cash transfers, subsidies for basic goods, and reduced public transport fares. Floating price mechanisms for chicken and targeted diesel subsidies are examples of the government's approach to alleviating cost pressures on essential goods.
Budget 2025 is also committed to ensuring continued targeted subsidies for essential goods and services, including fuel, electricity, and healthcare, ensuring 85% of the population is shielded from price hikes.
By gradually shifting subsidies away from the wealthy to the most vulnerable, the government aims to ease the financial burden on low- and middle-income groups.
Budget 2025 provides support to the elderly and disabled, while improving the living standards for Malaysians in rural areas
Budget 2025 has enhanced support for senior citizens and people with disabilities by increasing financial assistance and improving access to services such as healthcare and transportation. Specific programmes are aimed at ensuring these groups receive adequate care, housing, and social support.
This year's budget also allocated the largest-ever funding for autistic children's protection, channelled primarily through infrastructure improvements, such as building new PERMATA Centres, schools for special-needs students, and Autism Service Centres, as well as financial aid for families in need.
“This is a good start and will definitely be a big help to parents with autistic children. However, it would be nice to see these programmes expanded to other areas of special needs as well,” said Juanita, who is a mother of three.
Furthermore, Budget 2025 aims to improve the living standards of rural and remote areas, especially in Sabah and Sarawak. Billions of ringgit have been allocated towards basic infrastructure development, including access to clean water and electricity. The government is also prioritising flood mitigation systems in disaster-prone areas.
The SejaTi MADANI programme — which includes the Kampung Inisiatif Angkat MADANI — also gets a RM1 billion allocation, following its successful pilot last year. Beyond increasing rural allocations to stimulate local economic activities, the MADANI programme will provide technical and vocational education and training (TVET), affordable housing through the People's Housing Programme, and support for small-scale palm oil farmers to boost productivity.
