The Economic Action Council (EAC) announced that 600,000 M40 households, or at least 8% of Malaysian households, have slipped into the B40 category due to the pandemic. This expands the proportion of households earning less than RM4,850 per month.
According to the latest Household Income & Basic Amenities Survey Report 2019, the classifications for the B40, M40 and T20 income groups are as follows:
- B40: Under RM4,849
- M40: RM4,850 – RM10,959
- T20: RM10,960 and above
These figures refer to household income (the average household size in 2019 was 3.8 persons), not individual income. They are intended to provide a guideline on income disparity in Malaysia, with statistics showing 40% of Malaysians being low-income earners, 40% in the middle-income group, and 20% representing the top household incomes.
With the EAC’s announcement, this means a significant number of middle-income households have had their incomes fall to under RM4,850.
B40 expanding into B50
In February, Prime Minister Tan Sri Muhyiddin Yassin also said that the B40 group might have expanded into the B50 category, and that 10% of the T20 group has slid into becoming middle-income earners.
With more households experiencing declines in income, there have been calls to revise our national income classifications. Last year, UMNO MP Datuk Mohamad Alamin pointed out that the latest B40, M40 and T20 projections were made before the pandemic, but “Possibly it could be B40 is already B60, M40 has already become M20 and so on. I ask the government to revise this projection,” he said.
What can you do if you need help?
If you’re having trouble keeping up with the cost of living, or if your income has been affected by the pandemic, here are a few resources you can turn to.
- BPR. If you are eligible for Bantuan Prihatin Rakyat (BPR), you may receive cash assistance and other benefits.
- Loan moratorium assistance. You may be able to delay your loan payments or reduce them for six months.
- SOCSO. If you’ve been retrenched, you may be eligible for an allowance or job search assistance under the Social Security Organisation (SOCSO).
- AKPK. If you’re finding it hard to manage high-interest debt, the Credit Counselling and Debt Management Agency (AKPK) provides free credit counselling services.
- Social welfare aid. The Department of Social Welfare Malaysia provides welfare aid and other assistance to certain groups, such as single mothers or senior citizens.