Share this post

POLICY BRIEF

Highlights

  • Allocation for health increased by 4.3%
  • Funding for treatment of non-communicable diseases remains unclear
  • There is less allocation for mental health
  • The Disease Control Division needs more funding
  • Teaching/ university hospitals involved in the COVID-19 response appear to not benefit from an increase in funding
  • COVID-19 fund ceiling proposed to be raised to RM 65b.
  • Increase in tax relief for medical expenses related to serious diseases and fertility treatments

Health budget overview

  • The Ministry of Health has been allocated RM 31.94b in 2021 compared to RM 30.60b in 2020. From that amount RM27,223,685,300 has been allocated as operational expenditure (OPEX) and RM 4,717,819,000 as development expenditure (DEVEX).
  • Generally, there has been a reduction of OPEX allocation of 2.57%. This is due to RM 2.065b allocated for Hospital Support Services (HSS) (RM 1,928,583,000) and Clinic Support Services (CSS) (RM 137 million) reclassified from OPEX into new line items in DEVEX.
  • Beginning 2021, most allocations for medical supplies (including medicines, medical gas, reagents, vaccines, consumables, x-ray films etc) totalling RM 4.29b for hospital pharmacies, Klinik Kesihatan and Dental Clinics which were previously allocated under individual activities and specialisations have now been consolidated under the Government Facility Medical Supplies (Bekalan Perubatan Fasiliti Kesihatan) totalling RM 2.89b and the drug laboratory and store privatisation concessionaire of RM 1.4b.
  • This consolidation was done to ensure that monitoring of allocations and expenditure are able to be easily facilitated under all MOH medical facilities.
  • An allocation of RM 1.42b was also proposed for teaching/ university hospitals under the Ministry of Higher Education. This represents an increase of 6.7% compared to the RM 1.33b for 2020. However, most of the new funds will go towards the establishing of a new teaching hospital under Universiti Teknologi Mara.
  • The university hospitals involved in the COVID-19 response include Universiti Malaya, International Islamic University Malaysia, Universiti Kebangsaan Malaysia, Universiti Putra Malaysia, Universiti Sains Malaysia, Universiti Malaysia Sarawak, and Universiti Malaysia Sabah. Universiti Malaya will actually receive less in 2021 compared to 2020.

COVID-19 Fund

  • This temporary fund which spans three years and established under the Temporary Measures for Government Financing (Coronavirus Disease 2019 (COVID19)) Act 2020 (Act 830) legislation received a fiscal injection of RM 45 billion and is in effect from 27 February 2020 until 31 December 2022.
  • This legislation describes what programmes can be supported under this fund. The majority are economic stimulus programmes. Only RM 1b is allocated to the Ministry of Health for COVID-19 related expenses.
  • It was proposed the fund’s ceiling be raised to RM 65 billion to cover additional assistance under the KITA PERIHATIN package.
  • The fund’s proposed allocation for 2021 is RM 17 billion, which has been declared insufficient by stakeholders and parliamentarians.