During the retabling of Malaysia Budget 2023, Prime Minister YAB Dato’ Seri Anwar bin Ibrahim announced an allocation of RM750 million to the Ministry of Economy for the implementation of Inisiatif Pendapatan Rakyat (IPR).
The initiative aims to empower households of the hardcore poor and B40 to boost their ability to earn an income for the long haul through new approaches that address weaknesses of previous practices to eradicate poverty.
According to the Prime Minister, these include:
- Assistance and facilities to hardcore poor and B40 participants are no longer given in a single tranche but on a monthly basis and will be monitored for sale and lease back of equipment or employment subsidies for employers who employ them.
- Participants involved in economic activities must meet the needs of the local community, especially the agricultural and food sectors, to ensure consistent market demand.
- Through the programme, participants can earn between RM2,000 to RM2,500 within a 24-month monitoring period and, afterwards, enable them to generate their own income through the revenue obtained.
Two days later on 26 February 2023, IPR was launched by Minister of Economy YB Rafizi Ramli, who stressed the need to create a sustainable ecosystem that enables the poor to transition out of the extreme poverty line and prevent themselves from falling back in.
Hence, the programme is designed to involve three main target groups:
- Recipients or participants (Penerima), comprising households of the hardcore poor and B40. As of 31 December 2022, there are 126,372 hardcore poor households registered in eKasih, and around 2.9 million B40 households.
- Guides (Pembimbing), namely local businesses who purchase the recipients’ goods and services, or local non-governmental organisations (NGOs) and volunteers providing the likes of training and moral support to recipients. To ensure accountability and commitment to be part of IPR, recipients and guides are advised to be members of Koperasi Basmi Miskin Tegar (KOBMIT).
- Business or strategic partners (Rakan niaga atau strategik), consisting of large, medium and local private and public entities according to the value chain of goods and services, as well as government agencies that provide assets, capital and training.
More importantly, IPR employs a two-pronged strategy that not only prioritises increasing the income level of the hardcore poor and B40, but also resolving daily economic challenges affecting Malaysia as a whole through its initiatives.
“We want to make sure that the Government’s programme in eradicating poverty is not just giving assistance, but that assistance with the support of stakeholders within the entire ecosystem of the country will open doors to the hardcore poor and B40 so that they can move out of the poor category,” said Tuan Rafizi.
As it is expected to be implemented up to the end of the 12th Malaysia Plan, the Ministry of Economy is targeting up to 150,000 recipients for IPR by 2024.
Even it that target is not met at the end of that year, its minister hoped that the programme can serve as a template for future poverty eradication programmes in Malaysia.
As of 6 March 2023, 22,319 valid recipients have registered for IPR via its website (ipr.epu.gov.my) since its launch. Additionally, 376 off-takers including public and private entities have shown wide interest in the initiative.
Moving forward, the Ministry of Economy intends to attract more participants to join IPR, particularly in states or districts that have the highest number of hardcore poor families, such as Sabah, Sarawak, Kelantan and Terengganu.
CATEGORIES OF IPR
| THE CATEGORY | DAILY ECONOMIC CHALLENGES IT TACKLES | IPR’S SOLUTIONS | WHAT THE GOVERNMENT PROVIDES |
| Inisiatif Usahawan Tani (INTAN) | Lack of food raw materialsLocal food security | Increase local supplyFocus on strategic crop sector, e.g. chilli, ginger, corn, etc. | LandAgricultural infrastructureSkills training, agricultural technology and business trainingOperating cost, e.g. fertiliserMarketing supportBusiness matching with buyersMonthly allowance of RM500 while receiving harvestIncome through Koperasi Basmi Miskin Tegar (KOBMIT) |
| Inisiatif Usahawan Makanan (INSAN) | Expensive ready-made foodDependency on foreign workers | Price of ready-made food based on template – as low as RM2 to communities for breakfast and lunchShift of consumer behaviour to one that is machine-orientedNew job opportunities for local graduates with constant demand for vending machinesReduce dependency on foreign workers | Vending machines (rental payment for 24 months)Skills training, technology and business trainingBusiness location in strategic areasMarketing supportIncome through KOBMIT |
| Inisiatif Operator Perkhidmatan (IKHSAN) | Difficulty in finding workers for certain services, esp. in 3D sectors (dirty, dangerous and difficult)Dependency on foreign workers | Increase number of trained hardcore poor and B40 recipientsReduce dependency on foreign workersShift rakyat mindset on recipients or certain services, esp. 3D sectors | Equipment and suppliesAppointment matters with owner of facilitySkills training and business trainingAdditional allowance to supplement income up to RM2,000 per monthIncome through KOBMIT |
Source: Minister of Economy YB Rafizi Ramli’s presentation during the launching of IPR, 26 February 2023
Percentage of Recipients Registered for IPR (Based on Categories)
Total Recipients (as of 6 March 2023): 22,319
INSAN: 52%
INTAN: 29%
IKHSAN: 19%
Source: Press Statement by Minister of Economy YB Rafizi Ramli, 6 March 2023
Percentage of Recipients Registered for IPR (Based on States)
Total Recipients (as of 6 March 2023): 22,319
| Selangor | Johor | Perak | W.P. Kuala Lumpur | Negeri Sembilan | Kedah | Sabah | Pulau Pinang |
| 34% | 11% | 9% | 8.5% | 6.3% | 5.7% | 5.7% | 5.4% |
| Pahang | Melaka | Sarawak | Kelantan | Terengganu | Perlis | W.P. Putrajaya | W.P. Labuan |
| 3.3% | 2.7% | 2.4% | 1.7% | 1.5% | 0.5% | 0.4% | 0.07% |
Source: Press Statement by Minister of Economy YB Rafizi Ramli, 6 March 2023
References:
Kementerian Ekonomi. (2023). Inisiatif Pendapatan Rakyat | IPR. https://ipr.epu.gov.my/about
Kementerian Ekonomi. (2023, February 27). Majlis Pelancaran Inisiatif Pendapatan Rakyat (IPR). https://www.epu.gov.my/ms/galeri-gambar/majlis-pelancaran-inisiatif-pendapatan-rakyat-ipr
Ministry of Economy. (2023, March 6). Program Inisiatif Pendapatan Rakyat Mendapat Sambutan yang Baik Dari Rakyat. [Press statement]. https://www.epu.gov.my/sites/default/files/2023-03/Program%20Inisiatif%20Pendapatan%20Rakyat%20Mendapat%20Sambutan%20Yang%20Baik%20Dari%20Rakyat.pdf
Ministry of Finance Malaysia. (2023). Budget 2023 Official Website. https://budget.mof.gov.my/en/budget2023/
Rafizi Ramli. (2023, February 26). Majlis Pelancaran Inisiatif Pendapatan Rakyat (IPR) [Video]. YouTube. https://www.youtube.com/watch?v=ochUfRhIjMQ
