KUALA LUMPUR, Feb 11 — Targeted RON95 subsidies under the BUDI Madani (BUDI95) initiative are expected to generate savings of at least RM2.5 billion in 2026, Prime Minister Datuk Seri Anwar Ibrahim said today.

He said the projected savings — subject to global crude oil prices and currency exchange movements — are the result of successfully curbing subsidy leakages, including smuggling syndicates operating across Malaysia’s borders.

“In targeting subsidies through BUDI95, our priority is to ensure that the rakyat’s experience in purchasing petrol is not disrupted,” Anwar, who si also Finance Minister told the Parliament during the Minister’s Question Time. 

He was responding to DAP’s Bukit Bintang MP Fong Kui Lun who asked the Finance Minister on the amount of savings achieved through the implementation of BUDI95 throughout 2025 and the projected savings for 2026 as well as how such savings are utilised, whether they are channelled back to alleviate the cost of living for the people and to strengthen targeted assistance for the bottom 40 (B40) and middle 40 (M40) income groups.

Anwar added that that payment processes remain unchanged, with consumers able to pay via cash, credit card or e-wallet, while enjoying subsidised prices across all petrol station brands.

He also noted the use of MyKad has enabled subsidies to be channelled in a safer, more orderly and efficient manner.

“BUDI95 records an average of up to 3.1 million transactions daily, or as many as 96 million transactions per month — proof that the purchase of subsidised RON95 remains smooth,” he said.

He was referring to the 300-litre monthly cap for subsidised RON95 is sufficient for typical usage, citing data showing average monthly consumption of about 100 litres, with 90 per cent of users consuming less than 200 litres.

“Despite claims that said 300 litres isn’t sufficient, from our studies it has proven that this amount is sufficient,” Anwar said. 

He also thanked Malaysians who have alerted authorities to attempts by foreigners to purchase RON95.

“This attitude deserves praise — it is not merely about defending rights as Malaysians, but reflects patriotism and national identity,” he said.

Explaining further, the prime minister said that fiscal savings have been redistributed to benefit the rakyat, including initiatives such as the Sumbangan Asas Rahmah (SARA) programme.

He pointed out that on February 9, all 22 million Malaysians aged 18 and above received RM100 each via MyKad under the “SARA for All” initiative. 

“Within two days of implementation, nearly RM200 million was spent by two million Malaysians, generating spillover benefits for local retailers registered as SARA partner merchants, as well as suppliers of basic goods, including local micro, small and medium enterprises (PMKS),” he said.

In a supplementary question by Fong, asking if the government has any plans to curb leakage through illegal gambling dens, Anwar said there are ongoing enforcement targeting these activities. 

He however said that there are obstacles as these involved operators that are based abroad. 

“On smuggling and illegal gambling, action has already been taken and enforcement is ongoing. 

“However, curbing online gambling remains challenging as many operators are based overseas and use sophisticated digital mechanisms that allow platforms to reappear quickly after being shut down,” Anwar said. 

Responding to questions if the government has plans to narrow subsidies to only focus on the poor and hardcore poor, Anwar clarified that under the BUDI95 policy, fuel subsidies are maintained for all, unlike diesel and electricity subsidies which differentiate between commercial entities and other users.

He said the government had considered setting an income threshold for fuel subsidy eligibility, including an early proposal based on Department of Statistics Malaysia (DOSM) data to exempt those earning RM15,000 and below, but deemed it too restrictive.

“Even at RM13,000, many groups including civil servants would still be affected. If we raise it to RM25,000 monthly income, that may be more reasonable — meaning those earning RM25,000 a month would pay full fuel prices without subsidy,” he said.

However, he said such calculations would only affect about two per cent of the population, limiting potential savings, which is why the government decided to maintain broader fuel subsidy coverage for now.

“Fuel is used by all Malaysians. Targeting it too narrowly creates many complications,” he added.

On the cost of living, Anwar acknowledged that while lower fuel prices should theoretically ease costs, global import prices remain high.

To cushion the impact, he said the government has expanded cash aid programmes including Sumbangan Tunai Rahmah (STR) and SARA — with SARA allocations reaching RM15 billion — and an additional RM30 billion factored in to address persistent price pressures.

He noted that hardcore poverty rate has declined from 0.2 per cent in 2022 to 0.09 per cent in 2024, nearing eradication.

“Is there inflation? Yes. Is it a major issue? Yes,” he said, adding that Malaysia’s inflation rate has eased to 1.4 per cent in 2025, showing an improving trajectory.

“But it is not a total solution yet, because prices are still perceived as high and must continue to be controlled.”