Malaysia government considers net disposable income for aid distribution

The Malaysian government is evaluating the use of Net Disposable Income (NDI) as a basis for distributing financial aid. Deputy Economy Minister Datuk Seri Mohd Shahar Abdullah stated that relying solely on gross income does not accurately reflect the true financial status of households, particularly for the M40 middle-income group.

Data from the 2024 Household Income Survey shows the M40 group earns a monthly gross average of RM8,744, yet many spend nearly 70 percent of their income on basic necessities. The NDI approach aims to provide a fairer assessment by accounting for essential expenditures based on demographics and locality.

The Ministry of Economy is currently discussing a pilot project with relevant agencies to understand the fiscal impact of this new measurement method before it is finalized.

In the interim, the government continues to implement relief measures under Budget 2027, including the MADANI Housing Credit Guarantee Scheme, increased school assistance for 5.3 million students, and the upcoming launch of the MediAsas affordable medical insurance scheme in January 2027.