MOF: Budi Madani Diesel Sees RM5 Billion in Annual Savings

Malaysia’s diesel subsidy reform has generated annual savings of around RM5 billion since the Budi Madani Diesel Programme began on June 10, 2024.

The Ministry of Finance (MoF) said the savings have eased fiscal pressure and allowed funds to be redirected toward social protection and development projects that strengthen the economy.

Part of the funds has been used to enhance cash aid schemes such as Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (Sara). Their combined allocation rose from RM10 billion last year to RM13 billion under Budget 2025 and is set to increase further to RM15 billion through the Sara Appreciation initiative.

More than 140,000 individuals have received support under the Budi Individu category, while 180,000 beneficiaries were approved under Budi Agri-Komoditi, with total payouts of RM430 million and RM350 million respectively.

The Budi MySubsidi Diesel Programme for land transport operators has also expanded, with 121,618 companies and 355,074 vehicles approved for fleet card use as of Sept 30, 2025. These cards allow operators to purchase diesel at RM2.15 per litre, helping to contain logistics costs and stabilise essential goods prices.

Responding to a question from Rompin MP Abdul Khalib Abdullah, the MoF said targeted subsidies have helped reduce leakages while supporting fiscal discipline.

The Budi Madani RON95 (Budi95) initiative, introduced in Sept, has benefited 12.4 million Malaysians from 16.5 million eligible individuals. The programme has recorded over RM1.85 billion in fuel sales, representing more than 930 million litres of RON95 at RM1.99 per litre as of Oct 21, 2025.

The Ministry of Economy added that the Central Database Hub (Padu) plays a key role in verifying data for targeted fuel subsidies, helping government agencies design and deliver assistance more effectively to the right groups.

Source: MalayMail