Govt Saves RM5 Bln Through Diesel Subsidy Rationalisation – MoF

KUALA LUMPUR, Oct 22 (Bernama) -- The government has saved around RM5 billion a year through the diesel subsidy rationalisation under the BUDI MADANI Diesel Programme (BUDI Diesel) since its implementation on June 10, 2024, said the Ministry of Finance (MoF).

The MoF said these savings have reduced pressure on the country’s fiscal position and enabled funds to be redirected for more productive purposes, including strengthening the people’s social safety net. 

“Among the government’s proactive measures is the improvement of cash aid such as Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) by increasing allocation to RM13 billion under Budget 2025 compared to RM10 billion in the previous year, and further to RM15 billion through the SARA Appreciation initiative. 

“The savings are also used to fund development projects that can increase the country’s productive capacity,” said the MoF in a written reply on the Parliament’s website today.

The ministry also informed that more than 140,000 recipients under the BUDI Individu category and 180,000 recipients under BUDI Agri-Komoditi category have been approved, with total payouts of RM430 million and RM350 million respectively. 

For the land transport goods vehicle segment under the BUDI MySubsidi Diesel Programme, the MoF said that 121,618 companies involving 355,074 vehicles have been approved for the use of fleet cards, as at Sept 30, 2025.

This initiative allows these vehicles to obtain diesel at RM2.15 per litre, and ensuring that the operating costs in the logistics sector do not rise sharply and that the prices of essential goods remain affordable, it said.

The ministry said this in response to a question from Abdul Khalib Abdullah (PN–Rompin) who asked about the effectiveness of the targeted petrol and diesel subsidies in reducing leakages and easing the country’s fiscal burden.

Additionally, through the BUDI MADANI RON95 (BUDI95) initiative which began in September, the MoF said that over 12.4 million citizens out of 16.5 million eligible individuals have benefitted from RON95 petrol priced at RM1.99 per litre, involving sales worth over RM1.85 billion or consumption exceeding 930 million litres as at Oct 21, 2025.

Meanwhile, the Ministry of Economy, in the same written reply, said that for the targeted distribution of RON95 petrol subsidies, the Central Database Hub (PADU) serves as one of the key reference databases for validation by the MoF.

“Based on the available data, the government can identify socio-economic intervention programmes for specific target groups. In this regard, PADU can be utilised as a reference database by the relevant government agencies,” the ministry said.

-- BERNAMA