The Budget 2018 speech by Prime Minister Najib Razak: Part II

 Part 2

Digital Free Trade Zone

Malaysia will be the first in the world outside China to establish a Digital Free Trade Zone (DFTZ) which comprises e-Fulfilment Hub, Satellite Services Hub and e-Service Platform to stimulate growth in electronic trade. DFTZ will transform KLIA as the regional gateway.

The first phase of DFTZ aims for 1,500 SMEs to participate in digital economy and is expected to attract RM700 million worth of investment and create 2,500 job opportunities. For this, the government: First: Provides a sum of RM83.5 million to construct infrastructure for the first phase of DFTZ in Aeropolis, KLIA; and Second: Increases the de minimis or minimum value for imports from RM500 to RM800 to establish Malaysia as the regional e-commerce hub.

Regulatory Sandbox

The government will create a conducive ecosystem to gain benefits from innovation, particularly ideas from local startups.

The government will expand regulatory sandbox approach to facilitate companies to test their new innovative ideas and business model which will be implemented by all related regulators.


Enhance efficiency and delivery of Government-linked Companies (GLCs) and public service.

Employees in Government-Linked Companies

In line with the development philosophy of growth with equity, it is Malaysia’s desire to achieve strong economic growth and wealth be equally distributed among the rakyat. 207. In this regard, the GLCs will lead and be an example to the corporate sector. As such, every GLCs will be given Key Performance Indicator (KPI) to increase employees compensation in line with productivity growth. This includes: First: GLCs will increase their profit sharing with their employees through gradual payment of salaries and allowances; Second: Introducing flexible benefits to increase disposable income by substituting annual and medical leaves for cash; Third: Improving further flexible working arrangements to promote work-life balance through compressed work week, flexible and part-time working hours; Fourth: Introduce leaves for umrah; Fifth: Provide childcare centre in GLC’s main offices as well as introduce shorter working hours for pregnant working women; and Sixth: Increase investment in training, particularly conduct courses on digital skills to workers as well as provide children’s education assistance.

Prioritise the Welfare of Senior Citizens, People with Disabilities and Children

The government will provide an allocation of RM1.7 billion for the welfare of senior citizens, PWDs and children. This includes: First: Increasing allowance for senior citizens by RM50 to RM350 per month with an allocation of RM603 million. This will benefit almost 144,000 senior citizens; and Second: Increasing allowance for working and unemployed PWDs as well as care takers of PWDs by RM50 per month with an allocation of RM100 million. This will benefit more than 163,000 individuals.

Furthermore, to protect children, particularly from sexual crimes, the government has successfully set up the Special Criminal Court on Sexual Crimes against Children, the first in Southeast Asia. An additional three courts will be established in 2018.

Public Sector Home Financing Board (LPPSA)

From January 1, 2018, the Public Sector Home Financing Board (LPPSA) will implement measures to enable public servants to own their dream homes. Among the measures include: First: Allow financing by LPPSA to construct property on waqf land; Second: Include legal fee-related to sales and purchase agreement as part of financing by LPPSA; Third: Allow LPPSA joint-loan for husband and wife or children with a condition that all applicants must be public servants; and Fourth: Allow joint-home financing between husband and wife or children, with a condition at least one of the applicants is a public servant.

The non-public servant needs to secure loans from financial institutions or agencies that provide financing facilities which agrees to be the second mortgage holder.


The future is uncertain.

Nevertheless, Allah SWT favours those who continuously work hard, plan their future for the benefit of country and society as a whole.

Based on Surah Al-A’raf verse 96, Allah SWT bestows His blessings and grace upon those who believe and fear Allah.

Therefore, the government is targeting Malaysia: First: To become a High-Income Advanced Economy in 2020; Second: To record RM2 trillion of economy and trade value by 2025; Third: To gain and benefit from IR 4.0 by 2030; Fourth: To have a more competitive workforce with nearly zero defects by 2040; and Fifth: To be ranked among the top 20 advanced countries in the world.

Socio-economic Research Unit

The fact remains families are the most important institution in developing values and humanity as social unity starts with harmonious and happy family.

For this, the government will establish Socio-economic Research Institute (SERI) under Prime Minister’s Department and enhance the UKM Institute of Ethnic Studies (KITA-UKM) as a national institution. An appropriate allocation will be provided by the government.

SERI will review and evaluate the effectiveness of policies, and implementation of programmes and development projects. Meanwhile, KITA will coordinate studies on national socioeconomics education and establish the national social development index.

As an analogy, while the Economic Planning Unit (EPU) plays an important role in formulating economic policies and the Implementation and Coordination Unit (ICU) as the implementation arm of programmes and projects, the SERI and KITA will be the main agency which covers the aspects of spiritual, ethical and universal pure values.

The government always appreciate the role of NGOs and will continue to cooperate with them in addressing social challenges. Emphasis will be given to family institutions, which is the smallest yet most important nucleus in the development and wellbeing of our society.

Public Servants

As I mentioned in the 15th Majlis Amanat Perdana Perkhidmatan Awam (MAPPA) early this month, I have a few announcements for the 1.6 million public servants.

As a token of appreciation for the commendable services by the public servants, I am pleased to announce: First: Introduce second time-based promotion to supporting staff after 13 years from the first promotion; Second: Provide benefit to public servants who retire on medical reasons similar to those who retires at compulsory age; Third: Allow Cash Award in lieu of Accumulated Leave (GCR) of more than 150 days to be taken during the retirement year; Fourth: Increase special leaves for education officers from 7 to 10 days a year; Fifth: Provide unrecorded leaves to public servants up to 7 days throughout their service for the purpose of umrah; Sixth: Introduce new working hour from 9am to 6pm to provide further flexibility to public servants; Seventh: Provide Flexible Working Hour one day a week for Grade UD54 and above Medical Specialists who have served a minimum of four years and meet certain requirements; Eighth: Allow working women in their five month onwards of pregnancy to leave work an hour earlier. To accompany them, husbands are also allowed to go home an hour earlier with a allowed to leave work an hour earlier with a condition that the couple are working within the same location; Ninth: Increase total maternity leave from 300 to 360 days throughout service subject to a maximum of 90 days a year; Tenth: Encourage life-long learning among public servants through in-house Masters and PhD programmes; Eleventh: Set minimum pension of RM1,000 per month, benefitting more than 50,000 retirees with at least 25 years of service; and Twelfth: Extend the medical facilities to parents of retirees. All the above measures will take effect from January 1, 2018.

Neighbourhood and Community

To appreciate the contribution of village heads and tok batins, the government will provide a one-off special payment of RM1,500, benefitting 9,800 people. Of which, RM1,000 will be paid in January 2018, while the balance during Hari Raya Aidilfitri.

To create safe and peaceful environment in the neighbourhood areas, the government will continue to provide 1Malaysia People Community Grant up to RM10,000 to registered resident associations to purchase security equipment, clean and maintain neighbourhood areas with a total allocation of RM40 million.

In addition, RM40 million is allocated to GiatMara to implement the first phase of community training programmes, involving 50 PPR.

Uphold the Greatness and Integrity of Islam

My deepest condolences for the loss of 23 lives in the Darul Quran Ittifaqiyah Tahfiz Centre tragedy.

In this regard, the government will allocate a total of RM50 million to GiatMara for upgrading and maintaining wiring system in all registered Tahfiz schools nationwide.

Furthermore, GiatMara skills training scheme will be introduced to tahfiz school students.

Likewise, a total of RM588 million is allocated as monthly allowance for imam, bilal, KAFA and takmir teachers. As a token of appreciation including tok siak, the government would like to announce… A one-off payment amounting to RM1,500, will be given to them of which, RM1,000 will be paid in January 2018, while the balance during Hari Raya Aidilfitri. This will benefit more than 65,000 individuals with an allocation of almost RM100 million.


May Allah SWT bless this Budget 2018 presentation.

…What is the point of being wealthy but weak in soul.

The government aspires, not only as a nation with physical strengths but rich in soul and character i.e. par excellence in worldly and hereafter.

After months of hard work, involving ministries, agencies, private sector, NGOs, youth and professionals, and most importantly, all segments of the society have contributed through various platforms and channels in crafting this important document.

Thus, this Budget is the most inclusive that has ever been tabled.

This Budget encapsulates all the three important aspects Dho’ruriyat, Haajiyat and Tahsiniyat in safeguarding rakyat’s welfare and to prosper the nation.

This Budget that has never been crafted so well, even during the last 22 years or the past 60 years of our own nation, and marked in history, making this Budget the Mother of All Budgets.

Indeed, this Budget is the collection of various premises which form the basis of a comprehensive Budget, taking into account the needs of all levels of society.

With this, the Budget dispels all doubts as propagated by the opposition.

In fact, the opposition is surrounded by misconceptions and is the real actor. There is no certainty in political leadership, how can they be trusted to provide a sound economic leadership.

All these while, they have been making senseless propositions including abolishing GST and reducing taxes. All these are baseless claims.

All praises be to Allah, for His blessings on government’s efforts.

This is the right time to acknowledge public servants who have been loyal and provide efficient and effective public service delivery to the rakyat, hence, I am pleased to announce that… A special payment of RM1,500 be given to all public servants. The payment will be made twice, of which RM1,000 will be paid in early January 2018 while the balance during Hari Raya Aidilfitri. Meanwhile, the government will provide a special payment of RM750 to government retirees, of which RM500 to be paid in January 2018 while the balance during Hari Raya Aidilfitri.

I trust the rakyat is wise enough to differentiate between truths and lies.

More importantly, when the rakyat choose wisely it paves the path for Malaysia to flourish extensively.

When the rakyat and the government are united, then the country emerges as a great nation.

We have to plan strategically in charting the course of the nation.

This can only be achieved through great teamwork and friendship. I am grateful for being blessed with a loyal friend… Deputy Prime Minister, Datuk Seri Dr Ahmad Zahid Hamidi.

This include all the support from members of the Cabinet, leaders of component parties in steering the nation.

Come what may, we remain steadfast with our commitment.

Let’s together ensure a big victory for Barisan Nasional in the 14th General Election.

O Allah, to You, we pray and submit. God bless Malaysia. Mr Speaker Sir, I beg to propose. – October 27, 2017.

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