By ALIFAH ZAINUDDIN / pic by BERNAMA
The government today unveiled a RM250 billion stimulus package as the “nation is at war” against the devastating social and economic fallouts from the coronavirus pandemic.
The wide-ranging measures, the largest for the country since the Global Financial crisis of 2008/2009 includes direct cash payout to affected citizens, discounted rates for basic necessities, subsidies and incentives, loan payments moratorium, financial guarantees, grants to companies and additional allocations for critical sectors like healthcare.
Prime Minister (PM) Tan Sri Muhyiddin Yassin (picture) who unveiled the stimulus package called Pakej Rangsangan Ekonomi Prihatin Rakyat “Prihatin” said the huge package was needed as Malaysia is “a nation at war with invisible forces.”
“The situation we are now facing is unprecedented in history. This unprecedented situation of course requires unprecedented measures,” Muhyiddin said in a televised address today (March 27, 2020).
The latest package came less than a month after the first package worth RM20 billion. Malaysia has recorded more than 2,000 infections and 24 deaths, the hardest hit country in South-East Asia based on affected cases.
The stimulus package accounts for about 19% of the country’s gross domestic product of about RM1.4 trillion and over two-thirds of the government’s budget for 2020.
The latest package involves RM128 billion for households, RM100 billion to support businesses including small and medium enterprises, and RM2 billion to strengthen the economy – in addition to the RM20 billion previously announced.
The measures aim to support businesses to manage wage bills, utility receipts, schemes to help firms in the worst sectors and cash payouts for households to manage their expenses especially in the B40 and M40 groups.
Muhyiddin said about RM10 billion under Bantuan Prihatin Nasional will be disbursed in stages to individuals and families depending on income levels. Households with a monthly income of less than RM4,000 will receive cash assistance worth RM1,600, while families with income of less than RM8,000 will receive RM1,000.
Single individuals above the age of 21 with an income of less than RM2,000 a month will be eligible to receive a payment of RM800. Those with income between RM2,000 and RM4,000 will receive RM500.
Students in higher learning institutions will receive a one-off payment of RM200 in May, while vulnerable communities including senior citizens and homeless persons will receive assistance in the form of food, medical equipment and shelter via non-governmental organisations.
Frontliners fighting the Covid-19 pandemic will receive special payments. Medical staff will receive a higher allocation of RM600 per month from April 1 until the end of the Covid-19 pandemic.
The police, armed forces and the volunteer corps will receive RM200 from April 1 until the end of the movement control order (MCO) period. The Ministry of Health will also receive RM1 billion in additional funds to fight Covid-19.
Electricity tariff rebates have also been increased to a discount of up to 50% for six months depending on usage. The government has also allocated RM530 million for this on top of the RM500 million allocated previously. Households will continue to enjoy a discount of 2%.
The urban poor living in public housing areas in Kuala Lumpur will be exempted from paying rent for six months between April and September. Other states are encouraged to follow suit.
The telco industry will also provide free internet access for all customers from April 1 until the end of the MCO period. The move is expected to cost RM600 million. Additionally, RM400 million will be channelled to improve coverage and quality of the network.
Civil servants, including contract workers, will receive a one-off cash payment of RM500. Pensioners will also receive RM500. The government is also allocating billions of ringgit to minimise disruption in the supply of food, help SMEs and prevent massive layoffs at companies with low income.
The government said the stimulus is calculated based on its current fiscal capacity and adequate domestic financial market liquidity.
“All of the measures are one-offs to avoid burdening the government’s fiscal position in the medium term.
“The government will directly inject RM25 billion to reduce the burden of the people and business owners in braving the current economic challenges,” Muhyiddin said.