The government’s Bantuan Rakyat 1Malaysia (BR1M) monetary aid programme should not be extended to middle income earners, the Malaysian Institute of Economic Research (MIER) said today.
While acknowledging that cash transfers to targeted groups could help boost domestic economy, MIER executive director Datuk Dr Zakariah Abdul Rashid said that the aid, which is targeted for the bottom 40 percent income group, should not also encompass the “M40” (middle 40 per cent) bracket.
“BR1M, while it is stabilising in the short term, is not sustainable in the long run,” he told reporters after a briefing of MIER’s report on Malaysia’s economic outlook for the third quarter of this year.
BR1M, which was introduced in 2012, is expected to feature again when Prime Minister Datuk Seri Najib Razak unveils the 2017 federal budget at the end of this week.
“We want them (B40) to contribute to the economy. But of course, there are also many complaints about unproductive spending (using BR1M aid),” Zakariah said.
BR1M is targeted to about 5.7 million households with an income lower than RM4,000 per month.
However, Zakariah said that there is a need to increase the disposable income of the middle income earning group as well in order to boost participation in the local economy.