Prime Minister Anwar Ibrahim announces a RM10.5 billion allocation for state governments in 2026, marking a continued increase in federal support for development.

PUTRAJAYA: The National Finance Council has agreed to increase federal grants to state governments, with the total allocation expected to reach RM10.5 billion this year.

Prime Minister Datuk Seri Anwar Ibrahim said the increase reflects the MADANI Government’s commitment to strengthening state finances for nationwide socio-economic and infrastructure development.

He stated that the rise involves several grant categories, including the shared list grants, state road maintenance grants, and the distribution of tourism tax revenue.

“This increase follows the rise in the capitation grant rate starting in 2026, as outlined by the MADANI Government,” Anwar said in a statement after chairing the council meeting.

Capitation grants are federal funds distributed to states based on their population size.

The latest figure continues an upward trend, as federal grants had previously increased to RM10.3 billion last year from RM8.1 billion in 2022.

 The Sun Malaysia