TheHEALTH September/October 2025 | Page 8

08 COVER STORY The HEALTH | September-October. 2025

Modest steps towards reform

• While Budget 2026 raises the Health Ministry’ s allocation to RM46.5 billion, the slower growth rate and modest rise in development expenditure may hinder large-scale upgrades and systemic reform.
• The conversion of 4,500 contract doctors to permanent posts and the 40 % on-call allowance hike are long-awaited steps, but deeper structural issues— job security, burnout, and uneven postings— remain unresolved.
• Expanding rural clinic services, digital connectivity, and preventive health initiatives are positive moves; however, achieving equitable, high-quality healthcare will require sustained funding and rigorous implementation oversight.
BY HARVINDAR SINGH
Council Member Chartered Tax Institute of Malaysia
Tax Partner SCS Global Consulting( M) Sdn Bhd

THE Ministry of Health has been allocated RM46.5 billion for 2026, up from RM45.3 billion in 2025. This allocation represents roughly 11.0 per cent of the total federal Budget.

The budget aims to support a comprehensive health care reform, aligned with the 13th Malaysia Plan, focusing on improving access, quality, affordability, infrastructure, workforce welfare, and integration of public and private sectors.
There have been numerous calls for higher public healthcare spending as a percentage of GDP. The Malaysian Medical Association has been proposing that the expenditure be increased to five per cent from the current 2.4 per cent to sustain healthcare reforms better and handle rising costs.
Most developed nations have set a target of five per cent of GDP for public spending, and there have been calls for a roadmap to be in place to attain this level of public expenditure for the healthcare sector. A five-year roadmap would be useful to demonstrate a commitment to achieving it.
Although there is an increase in allocation, the rate of growth is slowing compared to previous years. The development expenditure( capital projects,
BUDGET BOOST: Prime Minister Datuk Seri Anwar Ibrahim outlines key budget allocations for healthcare during the presentation of Budget 2026
" It is mindboggling how doctors are expected to provide proper medical attention to patients under their care."
infrastructure) saw only a marginal increase, which may limit the scope or speed of new facility construction or large-scale upgrades.
Many of the government hospitals and clinics are dilapidated and major renovations or refurbishments are needed. To meet rising demand, sustain momentum, and address the backlog of infrastructure needs, more substantial increases in development expenditure may be necessary.
DIGITAL HEALTHCARE AND WORKFORCE REALITIES
Monitoring and evaluation frameworks should be in place for the new / expanded clinic services, outsourcing programs, and insurance schemes to ensure effectiveness and equity.
It is also essential to ensure that digital infrastructure( connectivity, especially in rural or remote clinics) is effectively deployed and maintained. Additionally, efforts should continue to address workforce issues, beyond just payments, to include training, retention, distribution( urban vs rural), and working conditions.
Budget 2026 addresses the plight of contract doctors, with 4,500 set to become permanent in 2026. There have, in fact, been ongoing efforts in the past
to convert the status of contract doctors to permanent positions, but these efforts have been hindered by transparency and bureaucracy issues.
There are serious calls for the contract doctor scheme to be discontinued and to revert to having permanent positions for doctors from the inception of their employment, as was the case about 10 years ago.
Contract doctors face issues with job security, affecting their ability to purchase houses, and they also experience morale issues.
A noble profession is now being shunned by many due to the numerous challenges faced by entrants, including continuous 24-hour call duties and the subsequent need to work an additional eight to nine hours within regular working hours.
COMMITMENT WITHOUT COMPLACENCY
It is mind-boggling how doctors are expected to provide proper medical attention to patients under their care.
The increase of On-Call Allowance by about 40 per cent, effective Oct 1, 2025, is long overdue, as it’ s the first increase in about 11 years. There should be periodical reviews of these allowances every few