Questions/Answers

The 1Malaysia People’s Aid (Malay: Bantuan Rakyat 1Malaysia – Acronym: BR1M pronounced BRIM) is an initiative introduced by the Government of Malaysia, back in 2011, as part of Malaysia’s Budget 2012. This financial aid (which will from now on be referred to as BR1M in this nomination form) is distributed to the public, with the purpose of providing a one-off cash assistance to households with a monthly income of Ringgit Malaysia (RM) 3,000 and below, in order to reduce the impact of the increasing costs of living on the low income groups. During the first year of its implementation in 2012, the process owners of BR1M faced two major problems; the difficulties in identifying the right beneficiaries who deserve to receive this aid and in processing BR1M application forms received manually. Later in 2013, the e-BR1M system was developed, which enables the process owners to accept, process and verify BR1M applications online. As of today, BR1M continues to benefit the citizens of Malaysia by extending this cash aid to Malaysians under these 4 categories: Category 1: Single, Unmarried Individuals Cash aid of RM 450 is given to eligible single individuals with income less than RM 2,000 per month. Category 2: Households with income between RM 3,001 and RM 4,000 per month Cash aid of RM 900 is given to eligible households with income between RM 3,001 and RM 4,000 per month. Category 3: Households with income less than RM 3,000 per month Cash aid of RM 1,200 is given to eligible households with income less than RM 3,000 per month. Category 4: Bereavement Scheme Compensation of RM 1,000 + remaining balance of BR1M cash aid yet to be received, are given to the next-of-kin of deceased BR1M recipients. All of the BR1M cash aid are transferred directly to the applicants’ bank accounts and for those without a bank account, the cash aid can be obtained from the bank, Bank Simpanan Malaysia (BSN) and its branch offices throughout Malaysia.

BR1M was originally introduced in Malaysia’s Budget 2012, with the purpose of providing a one-off cash assistance to households with a monthly income of RM 3,000 and less, so that they may use this aid to cope with the frequent increase in the costs of living over in Malaysia. In 2013, BR1M was then extended to single, unmarried individuals, with income less than RM 2,000. Beginning 2014, this cash assistance is also provided to households with a monthly income between RM 3,001 and RM 4,000. In 2015, the Bereavement Scheme under BR1M was introduced to the public. This scheme enables the next-of-kin of BR1M beneficiaries to receive RM 1,000 and the remaining balance of BR1M cash aid for that particular year. In 2016, the e-Kasih category was introduced where those who earn a monthly income below RM 1,000, are entitled to receive aid worth RM 1,050. This category was later dropped and absorbed into the Category 3 BR1M Eligibility: Households with monthly income less than RM 3,000. As of 31 December 2017, BR1M continues to benefit the citizens of Malaysia, under these 4 categories: C1: RM 450 to Single Unmarried Individuals with income less than RM 2,000 per month; C2: RM 900 to Households with income between RM 3,001 and RM 4,000 per month; C3: RM 1,200 to Households with income less than RM 3,000 per month; C4: RM 1,000 and pending BR1M to next-of-kin of deceased BR1M recipients

The initiative was selected for the category ‘Reaching the Poorest and Most Vulnerable through Inclusive Services and Partnerships’ because of the nature of BR1M itself as a form of cash hand-outs, provided to the citizens from the low income groups, the Bottom 40 (B40) of Malaysia’s income groups, who earn below RM 3,000 per month. The initiative was introduced as a solution to help the low income groups deal with ever-escalating costs of living and to reduce poverty in rural poor and urban poor areas. And to ensure that this aid is given to and received by the poor, the needy and the vulnerable, the Government of Malaysia ordered its Ministry of Finance (MOF) to handle the creation of policies, rules and regulations pertaining to BR1M and was also given the task in handling the payment of BR1M to eligible households. The Government also made the revenue collecting agency, the Inland Revenue Board of Malaysia (IRBM), to be in charge of managing all the affairs related to BR1M applications.MOF and IRBM, in turn, are assisted by 12 government agencies, in assessing and verifying BR1M applications; National Registration Department,IRBM, Accountant General’s Department+Malaysia Police,Armed Forces, Employees Provident Fund, Retirement Fund,Companies Commission,Road Transport Department,Islamic Departments,Ministry of Education & Higher Education and Ministry of Foreign Affairs.

The BR1M initiative improves public service delivery by identifying the poor, the needy the vulnerable, the B40 Malaysians, through the BR1M applications and providing them with aid in the form of BR1M cash disbursements. Instead of having them wait for help and attention, that may or may not come from the Social Welfare Department, the Armed Forces, the Fire and Rescue Department, the NGOs, and the corporate CSR programmes, the B40 Malaysians can now take a much more proactive approach by applying for BR1M manually or online, and acquire BR1M within the same year after applying for it. The B40 Malaysians will get to spend BR1M on things that are important to them while the Government attains data on BR1M applicants from the forms they fill in, which can then be used to monitor and help those in desperate need of finance, aid and attention. It is a win-win situation for all.

Prior to 2012, the B40 Malaysians would have to wait for the assistance and visits from the Social Welfare Department, NGOs and corporate CSR programmes, for them to receive some monetary aid and basic necessities. Though these aids and visits are sometimes few and far in between, and are usually focused on charity homes and children’s homes, sufficient public attention and financial aid are not given enough to poor families and poor single individuals who are living the hard life. By introducing BR1M, the Government of Malaysia provides wealth, hope and sense of security, back to the poor, the needy, the vulnerable, the B40 Malaysians, so that they may use the benefit that is BR1M, to sustain and to carry on living, belly-full and worry-free. Furthermore, the Government is also able to acquire some very important information on BR1M applicants from the forms they fill in, which can then be used to monitor and help those in desperate need of finance, aid and attention.

BR1M is one of the many initiatives introduced by the Government of Malaysia to ease inflation and to reduce the rising costs of living experienced by the citizens. From 2012 until 2017, BR1M has brought benefits to millions of Malaysian citizens and will continue to do in 2018, as per the following information: i. In 2012, 3.4 million citizens received the BR1M aid, with an allocation of RM 1.8 billion, as allocated in Budget 2012; ii. In 2013, about 7 million citizens received BR1M, with an allocation of RM 3 billion, as allocated in Budget 2013; iii. In 2014. 7.9 million citizens received BR1M, with an allocation of RM 4.6 billion, as allocated in Budget 2014; iv. In 2015, about 7 million citizens received BR1M, with an allocation of RM 4.9 billion, as allocated in Budget 2015; v. In 2016, 7.4 million citizens received BR1M, with an allocation of RM 5.9 billion, as allocated in Budget 2016; vi. In 2017, about 7 million citizens received BR1M, with an allocation of RM 6.8 billion, as allocated in Budget 2017; and vii. In 2018, about 7 million citizens are expected to be benefitted by BR1M, with an allocation worth RM 6.8 billion, as allocated in Budget 2018.

The BR1M initiative is innovative in nature as it makes use of the digital platform and the Internet, to accept, process and verify BR1M application and finally credit the BR1M cash aid, straight into the recipients’ bank accounts. In 2013, one year after the introduction of BR1M in 2012, the Inland Revenue Board of Malaysia (IRBM), the agency in charge of managing BR1M applications, developed e-BR1M, an online, web-based system where IRBM and BR1M staff as well as verifying agencies can accept, process and verify BR1M applications and where applicants can fill-in, update and check their BR1M applications online, anywhere, 24/7. The BR1M website can be accessed at the following URL: https://ebr1m.hasil.gov.my. In 2017, the BR1M Status-Check Mobile App for the IOS and Android devices (Malay: Aplikasi Mobil Semakan BR1M) was launched by The Honourable Datuk Seri Johari bin Abdul Ghani, Finance Minister II of Malaysia, on the 21st of February 2017 at IRBM’s Duta Branch Office. This mobile app allows applicants to check and review their BR1M applications on their mobile devices. Both systems were developed in responsive mode, meaning that the systems are viewable and usable in all mobile devices. Both systems adhere to the Go Green & Paperless concept and the verification system used in the e-BR1M system to detect frauds, saves the Government some RM 1.6 billion.

BR1M, along with 26 other 1Malaysia products, are original and exclusively Malaysian in nature. These 27 1Malaysia products are the brainchild of the current Malaysian Prime Minister, The Honourable Dato’ Sri Mohd Najib bin Tun Abdul Razak and are fully supported and endorsed by the Government of Malaysia. All 27 products were introduced with only purpose in mind, which is to ease the rising costs of living, faced by the citizens. And BR1M was made available to the public, to aid those from the low income group, who are heavily affected by the escalating costs of living and food prices. Among the 27 1Malaysia products are: i. Kad Diskaun 1Malaysia (1Malaysia University Student’s Discount Card) – Allows a registered student to attain RM 250 cash aid and some discounts at selected stores. ii. Kedai Rakyat 1Malaysia (1Malaysia People’s Shop) – Mini markets that sell daily essentials and groceries at prices 30% to 50% cheaper than other supermarkets. iii. Klinik 1Malaysia (1Malaysia Clinic) – Clinics which provide quality and affordable basic healthcare for Malaysians. iv. Klinik Bergerak 1Malaysia (1Malaysia Mobile Clinic) – Mobile Clinics, via buses or boats, that provide basic healthcare services to Malaysians residing in remote areas who have difficulties in accessing available medical centres.

4 types of resources are used to implement the BR1M initiative. They are: (1) Financial Resources From 2012 to 2018, a portion of the National Budget is allocated for the distribution of BR1M to the public as follows: i. 2012 – RM 1.8 billion ii. 2013 – RM 3 billion iii. 2014 – RM 4.6 billion iv. 2015 – RM 4.9 billion v. 2016 – RM 5.9 billion vi. 2017 – RM 6.8 billion vii. 2018 – RM 6.8 billion (2) Human Resources To ensure that BR1M is given to and received by the B40 Malaysians, the Government ordered its Ministry of Finance (MOF) to handle the creation of BR1M policies and regulations as well as the payment of BR1M. In addition, the Inland Revenue Board of Malaysia (IRBM) was given the responsibility to manage the process and verification of BR1M applications. Both organisations are then assisted by the 12 government agencies in verifying all the BR1M applications, as stated (3) Information Technology The digital platform and the Internet are used in developing the e-BR1M system and the BR1M Status-Check Mobile App. The two systems were made in responsive mode and were created in-house by IRBM’s IT Department and the Tax Operations Department. (4) Publishing Printed materials in the form of BR1M application forms, BR1M pamphlets, posters, banners and buntings are used to disseminate information on BR1M to the public. These materials are updated on a yearly basis.

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Yes. The Malaysian BR1M cash aid has inspired similar innovations in 2 other countries, namely The Kingdom of Saudi Arabia (KSA) and Egypt. (i) KSA’s Citizen’s Account A national cash transfer programme introduced by the Government of Saudi Arabia in December 2016 and was opened for registration in February 2017. The Citizen’s Account was introduced to provide government benefits to low and medium income households in KSA. The entitlement for this aid depends on these 3 main factors; the total income of the household, number of dependents and their age. (ii) Egypt’s Takaful and Karama (Solidarity and Dignity) Programmes Egypt’s own conditional and non-conditional cash transfer programmes named ‘Takaful (Solidarity) and Karama (Dignity)’ were introduced in March 2015. The Takaful programme provides monthly income to poor families with children ages 0-18 years old. This aid is given per family and per child the family has that go to school, based on an incentive-based system relating to school attendance and the usage of maternal and child healthcare services. On the other hand, the Karama programme provides monthly income to 2 vulnerable groups of Egyptian citizens; the poor elderly people ages 65 and over, and people with severe disabilities who are not able to work and find work.

Yes, the BR1M cash aid is sustainable for the beneficiaries as the financial aid is not given in full amount but in 3 stages, during a particular year, to encourage frugality and to avoid careless, full spending, by the BR1M recipients. The cash aid is credited to the beneficiaries’ bank accounts at the following months: Category 1: Single Unmarried Individuals Amount of BR1M given: RM 450 Credited in: February – RM 450 Category 2: Households with Income between RM 3,001 and RM 4,000 per month Amount of BR1M given: RM 900 Credited in: February – RM 300, June – RM 300, August – RM 300 Category 3: Households with Income below RM 3,000 per month Amount of BR1M given: RM 1,200 Credited in: February – RM 400, June – RM 400, August – RM 400 For beneficiaries without a banking account, they can obtain the cash aid straight from the bank ‘Bank Simpanan Malaysia’ and its branch offices across Malaysia, during the same months BR1M payments are credited into the bank accounts. As long as the beneficiaries are frugal and wise in their spending, the BR1M cash aid should be able to sustain them, through out that particular year.

Yes, the BR1M initiative is sustainable, as for the past 6 years beginning 2012, the Government of Malaysia has been distributing this cash aid to those from the low income groups continuously. A total of RM 27 billion were allocated for BR1M, from 2012 to 2017, and as stated in the National Budget for 2018 on the 27th October 2017, the Government of Malaysia will continue to provide BR1M to the B40 Malaysians, with an allocation of RM 6.8 billion. For as long as there are poor people and poor families, and there are still people who earn low wages here in Malaysia, without a shadow of a doubt, this initiative will continue to provide cash aid and hope to the citizens of Malaysia, for many years to come. After all, one of the reasons, Governments of various countries impose taxes on their citizens and residents, is so that the Government can use the revenues gained from the imposed taxes to transform their country for the better and help the public attain better quality of life. BR1M is nothing more than the taxpayers’ money being channelled back to the public, for them to use in improving the state of their lives.

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Yes, the BR1M initiative has been evaluated formally by The World Bank, in their December 2014 report – ‘Malaysia Economic Monitor towards a Middle-Class Society’. The initiative was evaluated using information obtained from Malaysia’s Household Income and Basic Amenities Survey 2014, conducted by The Department of Statistics Malaysia, as well as calculations made by the World Bank representatives. The data from the survey were collected, compiled and analysed within a 12 month period in 2014.

According to the report ‘‘Malaysia Economic Monitor towards a Middle-Class Society’ by The World Bank, it states that: (i) BR1M reaches over 90 percent of the vulnerable group (Report Page 74 / PDF Page 83); (ii) BR1M and welfare payments are highly progressive (Report Page 75 / PDF Page 84); and (iii) Government Transfer Programmes contribute to the reduction of poverty and vulnerability in Malaysia, where income transfers, scholarships and one-off-receipts (BR1M) reduce, not only the number of people living below the poverty threshold, but they also increase the income of those who remain poor (Report Page 75 / PDF Page 84). The report concludes that even though the Government’s Income Transfer Programmes, such as BR1M, may have a limited effect on the poor and the vulnerable, its impacts however, are generally positive, reduce poverty and raise the income of the Malaysian poor and vulnerable.

(i) The Household Income and Basic Amenities Survey 2014 Conducted by the Department of Statistics Malaysia in 2014, this survey collects data on the characteristics of Malaysian households and was carried using the personal interview approach and the probability sampling methodology. All 14 states of Malaysia were covered in this survey, involving the urban and rural strata. The full completed report was released to the public on 22 June 2015 and contains findings on the 2014 statistics of household income, statistics of incidence of poverty, statistics of basic amenities, statistics on basic amenities for poor households, median and mean incomes of Malaysian households and the Gini Coefficient. (ii) The World Bank The World Bank uses calculations made by its staff and extracts information from its World Bank Open Data database (which has recorded information on a country’s GDP, poverty headcount ratio, population etc.) to evaluate the effectiveness of BR1M in Malaysia.

The actors involved in designing, implementing and evaluating BR1M are as follows: (i) The Government of Malaysia Responsible in overseeing the overall process of BR1M distribution to the B40 Malaysians and ensuring that BR1M is received by them. (ii) Ministry of Finance (MOF) Responsible in creating the policies, rules and regulations related to BR1M, based on the aspirations and goals of the Government of Malaysia. Also responsible in the payment of BR1M to eligible households. (iii) Inland Revenue Board of Malaysia (IRBM) Responsible in managing all the affairs related to BR1M applications. The affairs of BR1M are jointly handled by IRBM’s Tax Operations Department and the IT Department, and are assisted by BR1M staff, all across Malaysia, with a workforce of 1,000 people. (iv) 12 Verifying Agencies The 12 previously stated government agencies assist MOF and IRBM, in reviewing and verifying all the information submitted by BR1M applicants, using the e-BR1M system developed by IRBM. (v) Bank Simpanan Malaysia (BSN) BSN is responsible in handing out the BR1M payment in cash, to all the approved applicants, who do not have any bank accounts of their own.

(i) People are willing to go to great lengths to acquire BR1M. Some would call the BR1M hotline 1-800-88-2716 frequently to ask about their BR1M status. Some would ask questions over IRBM’s social media pages about BR1M. Some argue with the BR1M staff, because their applications were rejected, some falsify their personal information, just to be eligible to get more BR1M. (ii) Based on a national survey by a market research group ‘Kajidata Research’ in Feb 2017, the majority of the Malaysians agree BR1M help them cope with their financial burden and that the initiative should continue its implementation in the future. The survey found most beneficiaries spend BR1M on basic necessities and paying monthly commitments. BR1M is usually used up within 3 months and BR1M has encouraged the poor to seek financial help from the relevant authorities, resulting in the creation of a database on the needy, which are used to provide the right aid to the targeted groups and allow the Government to monitor their well-being. Improvements: (i) Develop better detection and verification mechanisms to accurately assess the eligibility of BR1M beneficiaries, as there were some complaints that the aid is not channeled to those in need but was received by people who were well-off. (ii)Add a new eligibility category based on the number of dependents an applicant has, for them to take care adequately.