Former finance minister Daim Zainuddin is mulling a revamp to Malaysia’s welfare policies to provide a basic income for the country’s poor.
Daim, who heads the new government’s advisory Council of Eminent Persons, said the former government spent about RM37 billion on subsidies and cash handouts such as BR1M which he described as a waste.
Instead, he said, the money would be better spent if it was channelled to a fund which will invest in assets.
The proceeds will then be distributed to the poor as their basic income each month instead of a one-off payment, he said.
“Every year, it is wasted whereas this one continues.
“If we invest properly, I think there is sufficient income to take care of all the needs of all these people,” Daim said, as reported by Bloomberg today.
The Finance Ministry had said that more than seven million people were to receive the BR1M cash handout in 2018 amounting to RM6.12 billion.
Prime Minister Dr Mahathir Mohamad had previously criticised BR1M as a way for former ruling party BN to win political support.
The new Pakatan Harapan government has since announced that they will replace the BR1M with a cost of living aid instead.
Though former prime minister Najib Abdul Razak’s administration had espoused the goal of achieving the status of a high-income nation, Daim said the new government is more focused on how to create inclusive and sustainable growth.
“There is no point in saying high income when seven million of them depend on BR1M.
“What we want is a developed nation status where everyone can climb the social and economic ladder.
“This entails introducing policies which encourage businesses while at the same time ensuring the welfare of the people,” he said.