SABAH will trim its spending in 2026, cutting RM19.35 million despite a larger overall budget, Deputy Chief Minister cum State Finance Minister Datuk Seri Masidi Manjun said.
He said the estimated supply expenditure for 2026 stands at RM6.402 billion, comprising RM5.202 billion for operational expenditure and RM1.2 billion in contributions to the Development Fund, reflecting what he described as careful planning amid economic uncertainties.
He said that following the restructuring of supply and development expenditure from 2026, operational expenditure covering emoluments, recurrent spending and special expenditure was “reduced by RM19.35 million or 0.3 per cent” compared with the 2025 original estimate of RM6.421 billion.
Despite the overall reduction, Masidi said emolument expenditure will rise to RM936.73 million to meet salary commitments for civil servants, an increase of RM32.82 million or 3.63 per cent due to annual increments, the Phase 2 salary revision of between three and seven per cent under the Public Service Remuneration System effective December 1, 2024, and new recruitments.
Recurrent expenditure is proposed at RM2.22 billion, or 34.68 per cent of total supply expenditure, representing a decrease of RM49.94 million or 2.2 per cent from the 2025 allocation, with spending focused on service and supply costs, asset procurement, administration, human resources and non-development programmes.
Masidi said special expenditure will also be pared down to RM2.045 billion, a reduction of RM222.23 million or 9.8 per cent, as several items previously classified under this heading are being transferred to development expenditure.
He noted that the remaining special expenditure will continue to fund assistance to government agencies, paddy cultivation subsidies, outsourced water treatment and concession services, centralised procurement of vehicles and boats, as well as programmes under the Sabah Agriculture Department.
On development spending, Masidi proposed an allocation of RM1.865 billion for 2026 to support economic growth, comprising RM1.468 billion from the State Government and RM397.21 million from the Federal Government in the form of loans and reimbursables.
He said the state-funded development allocation will prioritise the economic sector with RM996.47 million or 67.90 per cent, followed by the social sector at RM345.77 million or 23.56 per cent, and general administration at RM125.40 million or 8.54 per cent.
Masidi told the House that under the Thirteenth Malaysia Plan (13MP), Sabah has secured an approved ceiling of RM12.02 billion for 1,173 development programmes and projects, the highest in the state’s budget history, with 241 continuation projects and 932 new initiatives.
