KUALA LUMPUR: Total federal government expenditure for 2027 Budget is estimated at RM459.8 billion, according to the Fiscal Outlook and Federal Government Revenue Estimates Report 2027.
The report said this is equivalent to 19.8 per cent of gross development product (GDP) and represents an increase of 3.6 per cent from the revised 2026 budget.
“Of the total, RM376.8 billion or 81.9 per cent is allocated for operating expenditure (OE), while the remaining RM83 billion is earmarked for development expenditure (DE).
“Expenditure will remain concentrated on rakyat-centric projects and programmes, with 30.2 per cent of the total allocation channelled to the Education Ministry, Health Ministry and Defence MInistry,” it said.
In terms of sectoral allocation, the report said the social sector will receive the largest share at RM161.6 billion or 35.1 per cent of total expenditure, reflecting the government’s continued emphasis on human capital development and public welfare.
“This is followed by the economic (RM59.4 billion;12.9 per cent), security (RM46 billion; 10 per cent) and general administration (RM23.4 billion; 5.1 per cent) sectors.
“The remaining RM169.4 billion comprises charged expenditures and transfer payments,” it said.
The report said OE is budgeted at RM376.8 billion or 16.2 per cent of GDP, representing an increase of 3.8 per cent from the revised 2026 budget.
It noted that this is mainly attributed to higher allocations for emoluments, retirement charges, debt service charges (DSC) as well as supplies and services.
Meanwhile, the report said DE is projected at RM83 billion in 2027, including allocations for approximately 1,500 newly approved programmes and projects.
“The economic sector continues to receive the largest share at 45.4 per cent, followed by social (33.7 per cent), security (14.7 per cent) and general administration (6.2 per cent) sectors.
“In line with the requirements of the Public Finance and Fiscal Responsibility Act 2023 [Act 850], the government remains committed to allocating at least three per cent of GDP to DE,” it said.
The report said emphasis will be accorded to programmes and projects that strengthen productivity, improve public service delivery, enhance socioeconomic resilience and contribute to the well-being of the rakyat.
“A total of RM37.7 billion is allocated for the economic sector to strengthen national competitiveness through the expansion of strategic infrastructure and the promotion of investment activities.
“The transport, environment as well as trade and industry subsectors receive the largest shares of the allocation, reflecting the government’s continued emphasis on strengthening connectivity, supporting sustainable development and enhancing the investment ecosystem,” it added.