Covid-19: Government announces ‘KITA Prihatin’ economic stimulus and relief package

On 23 September 2020, the Prime Minister of Malaysia, Tan Sri Muhyiddin Yassin, announced the Kerangka Inisiatif Tambahan PRIHATIN (‘KITA Prihatin Package’), an economic stimulus and relief package to assist businesses and individuals who continue to be affected by the economic challenges brought about by the Covid-19 outbreak.
The KITA Prihatin Package is in addition to the initiatives announced by the Government earlier this year, such as the Prihatin, Prihatin SME+ and the Penjana packages.
The Kita Prihatin Package is valued at RM10 billion and comprises the following initiatives -
  • Wage Subsidy Programme 2.0 (‘WSP 2.0’)
  • Prihatin Special Grant (‘PSG’)
  • Bantuan Prihatin Nasional 2.0 (‘BPN 2.0’).
  1. WSP 2.0
Under WSP 2.0, eligible employers will receive a monthly wage subsidy of RM600 per month for three months for each employee, subject to a maximum of 200 employees.
To be eligible for the subsidy under WSP 2.0 -
  1. an employer must show that it has suffered a loss in revenue of at least 30% since the period of the recovery movement control order (RMCO) as compared to the previous year;
  1. an employer must be registered with the Social Security Organisation (‘SOCSO’) on or before 31 August 2020; and
  1. an application for this relief must be submitted between 1 October 2020 to 31 December 2020.  
The Prime Minister added that employers who did not receive any subsidy under the existing Prihatin Wage Subsidy Programme will be eligible to receive a subsidy for six months under WSP 2.0.
The Government estimates that the WSP 2.0 initiative will involve a sum of RM2.4 billion and will benefit 1.3 million employees.
  1. PSG
To assist micro-businesses, the Government will reopen applications for the Prihatin Special Grant from 1 to 31 October 2020.
Under the PSG, each eligible micro-business will receive an assistance of RM3,000.
To be eligible for this benefit, a micro-business must be registered with, or hold a business licence issued by, the Companies Commission of Malaysia or a Local Authority on or before 31 August 2020.
Payments under the PSG will commence from 25 November 2020.
The Government estimates that the reopening of the PKG initiative under the KITA Prihatin Package will benefit 200,000 micro-businesses and involve an expenditure of up to RM600 million.
  1. BPN 2.0
Under BPN 2.0, financial assistance by way of cash payments will be made as follows –
  1. RM1,000 each to 3.7 million families in the B40 group;
  1. RM500 each to 3.8 million single persons in the B40 group;
  1. RM600 each to 1.4 million families in the M40 group; and
  1. RM300 each to 1.7 million single persons in the M40 group.1
The financial assistance under BPN 2.0 will be paid by two instalments, the first of which will be made at the end of October 2020 and the second, in January 2021. 
No application is required in order to be eligible for the payments under BPN 2.0. Payments, amounting in total to approximately RM7.0 billion, will be made to the 10.6 million approved recipients under the existing Bantuan Prihatin Nasional initiative. 
The Prime Minister added that those who did not receive payments under the existing Bantuan Prihatin Nasional initiative will be given the opportunity to appeal and submit a new application.

1 The acronyms ‘B40’ and ‘M40’ describe the 40% lowest and the 40% middle income segments in Malaysia.