BR1M: The Views of a Sensible Malaysian

Here is a sincere write-up by a young Malaysian on the benefits and justification of Bantuan Rakyat 1 Malaysia (BR1M).

Excerpt:

[1]   BR1M 2014 was launched yesterday, 22 February 2014 to some fanfare. According to reports, RM4.5 billion has been allocated for BR1M 2014 which would benefit some 7 million people.

[2]   Personally, I am a fan of the initiative, as I believe targeted subsidies are the way to go – let those truly deserving get government assistance, and for people like me, we can take care of ourselves.

[3]   Personally, I stand to lose from BR1M. I am not entitled to it, and any reduction in subsidy will mean I pay more for certain goods (and being in the middle income bracket, I’m not rich enough to the point that it wont matter *Sad face*).

[4]   Nevertheless, I feel that the benefit to those who really need the targeted subsidy outweighs my personal (and financial) interest.

[5]   And yes yes, if the Government plugged leakages and wastages, strengthened the economy etc. etc. we’d be in a much better position, financially and purchase power-wise, but hey, that’s a grouse for another day (and don’t worry, I won’t let that go. Just waiting for the next Auditor-General report).

[6]   In this article, I want to look at BR1M and write about the 4 reasons why BR1M is good an necessary. I do not think it is political candy (and my staunch-opposition economist friends say that it’s in fact a good idea – but PR cant say that). So, here’s a preview of the 4 reasons:

a. A web of benefits;
b. Targeted subsidies are the future;
c. Right time;
d. Br1M is more sophisticated than it looks.

 A little about BR1M

[7]   Anyway, BR1M, short for Bantuan Rakyat 1 Malaysia or 1 Malaysia Peoples Aid, was introduced in 2012 by the Malaysian Government. According to some website (which might belong to cyber-troopers), it was introduced: (a) To assist low-income households manage rising costs of living; and (b) As part of a long-term plan to reduce Government subsidies on essential goods.

[8]   BR1M’s overarching objective is to ensure that only Malaysians who need the assistance, regardless of race and religion, are able to enjoy financial assistance from the Government.

[9]   In 2012 and 2013, RM500 was given to households earning less than RM3000 a month. In 2014, the amount is being increased to RM700 (650 + 50 for insurance) for households earning less than RM3000 a month and to households with an income range between RM3000 and RM4000 per month. An additional RM50 for Takaful (insurance) will be provided for every household recipient, giving access to vital insurance coverage which includes medical coverage. Individuals earning below RM2000 will receive RM300.

[10]     In 2013, there were 6.8 million recipients of BR1M. In 2014, there will be about 7 million (and increase of 1.2 million). It’s important to note that this isn’t because Malaysians are earning less or becoming poorer, but because the BR1M net has been cast wider, and more Malaysians will benefit.

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