PUTRAJAYA, June 23 — The Ministry of Agriculture and Food Security (KPKM) says food production subsidies and incentives have been protected from government spending cuts.
Spending cuts are focused on operating expenditure including promotional activities and lower-priority programmes instead, as Putrajaya tightens expenditure amid a challenging fiscal environment due to soaring fuel subsidies as a result of the West Asia conflict.
KPKM secretary-general Isham Ishak said the Ministry’s RM2.8 billion allocation for subsidies and incentives under Budget 2026 remains intact to ensure food production remains sustainable and can continue to meet domestic demand.
“Alhamdulillah, the government continues to support us in terms of subsidies,” Isham told CodeBlue in an exclusive interview at Wisma Tani here last Friday.
“There’s no cut in subsidies because we want to make sure productivity remains sustainable and, if possible, increases further.”
KPKM received RM4.8 billion for operating expenditure (OE) under Budget 2026, including RM2.8 billion for subsidies and incentives.
Isham revealed to CodeBlue that the Ministry of Finance (MOF) had instructed 10 to 20 per cent budget savings from OE for all ministries, departments, and agencies across the board, similar to the initial 10 per cent cuts previously disclosed by Ministry of Health (MOH) secretary-general Hasnol Zam Zam Ahmad.
While acknowledging spending reductions across federal government, Isham said KPKM had managed the cuts through reprioritisation rather than reducing support for farmers and food producers.
“We’ve focused more on priority areas,” he said. “For the lower-priority ones, we did some trimming to support areas that we felt were important.”
According to Isham, promotional and related activities were among the areas affected by spending cuts, while programmes linked directly to food production were largely preserved.
“We are very happy that we’ve been able to manage those funds well to ensure that our food production remains sustainable and continues to support demand in the country,” he said.
Isham did not elaborate further on how a budget cut, which amounts to about RM200 million of KPKM’s 2026 budget, was being implemented in the Ministry, beyond promotional or “lower-priority” programmes.
“We manage within the budget,” he said. “During times of difficulty, we will support the government.”
At the same time, Isham expressed confidence that government support for agricultural subsidies would continue despite the challenging economic outlook.
“For next year too, we feel that the government is going to continue supporting us in terms of subsidies,” he said. “There are no cuts in subsidies for now, so we’re very happy.”
Isham said KPKM expects 2026 and 2027 to remain challenging years and has been engaging stakeholders to prepare for tighter fiscal conditions.
“We have known this for quite some time already and we’ve been engaging the stakeholders,” he said. “I think that’s working very well, the understanding between our stakeholders and the government.”
Asked whether tighter fiscal conditions could affect the government’s ability to provide additional funding to ministries when surplus revenue is available, Isham said he could not predict whether such revenue would materialise.
“I can’t say because I don’t know when those extra revenues will come,” he said.
Isham instead urged the private sector to contribute more to the agriculture sector, saying stronger industry participation would help strengthen the sector’s long-term sustainability.
“Maybe what I would like to urge is for the private sector to assume its role and see wherever there is excess, they can contribute back to the agriculture sector,” he said.
“Because in the long term, this would help strengthen the ecosystem within the agriculture sector and benefit them in the long run because they will also become part of the ecosystem.”
Food Security Act Planned To Protect Agricultural Production
Separately, Isham revealed that KPKM is planning a new Food Security Act aimed at providing long-term legal, financial, and policy support for Malaysia’s food security agenda.
He said agriculture has become increasingly intertwined with technology, allowing improvements in food quality, productivity, and supply resilience. “Agriculture relates very closely to food supply. Food supply means food security,” he said.
“There is an evolution in the industry where we now try to incorporate a lot of technology into the sector. So when you have technology, you have better food quality, higher yield in terms of productivity and better food security.”
Isham said the Ministry’s long-term objective is to create a comprehensive ecosystem supported by the government, industry, and other stakeholders.
As part of that effort, KPKM intends to introduce legislation that would institutionalise food security as a national priority beyond individual administrations.
“For us in the long term, we plan to come up or develop a new Act on food security, which we think will continue to provide the right mechanism in terms of policy support, in terms of finances, resources and also in terms of legal support in ensuring that the food security agenda will continue to be sustainable over the long term,” he said.
According to Isham, the proposed law would establish a legal framework to support food security initiatives, strengthen enforcement mechanisms, and provide assurances of continued government investment in the sector.
He said the legislation would also seek to safeguard the welfare of farmers and fishermen, while protecting agricultural production from disruptions.
“It’s important that the welfare of our farmers and fishermen is taken care of,” he said. “Protection against harmful or disruptive attacks against our farmers and our farm produce is important.”
Isham said KPKM believes the proposed Food Security Act would help ensure that food security remains a long-term national priority and strengthen Government policy support for the sector.
A food security expert from Universiti Putra Malaysia (UPM) previously urged the federal government to provide incentives to state governments to preserve land for food production, amid a growing conversion of agricultural land to housing and industrial development. Land is primarily under the jurisdiction of state governments.
