THE Dewan Rakyat on Thursday passed the National Trust Fund (Kumpulan Wang Amanah Negara, KWAN) Bill 2026, introducing the first major reform of the sovereign fund since its establishment in 1988.
The legislation is designed to reinforce KWAN as Malaysia's intergenerational savings fund, ensuring a sustainable financial reserve that benefits both present and future generations.
According to the Ministry of Finance, the reforms reflect the MADANI Government's commitment to strengthening public financial management, preserving the nation's wealth sustainably and ensuring that today's national revenues continue to benefit Malaysians in the decades ahead.
In line with the Government's broader economic reform agenda, the Bill introduces significant measures to enhance governance, strengthen fiscal discipline and improve Malaysia's long-term financial resilience.
A key feature of the legislation is the establishment of the National Trust Fund Corporation (Kumpulan Wang Amanah Negara (Diperbadankan)), a new statutory body that will replace the existing Panel structure.
The new corporation will be governed by a Board responsible for administering, managing and investing the fund.
During the transition period, Bank Negara Malaysia (BNM) will continue managing and administering the fund, a role it has performed since KWAN's inception, to ensure uninterrupted operations.
Under BNM's stewardship, KWAN's assets grew to RM22.43 billion as at the end of 2024. The Ministry said there would be no disruption to investments, contracts or operational activities during the transition, with all assets transferred automatically to the new statutory corporation under the provisions of the law.
For the first time, the Bill introduces legally binding provisions governing contributions, withdrawals and investment management.
Under the new framework, the Federal Government will be required to contribute a minimum of 0.1 per cent of projected annual federal revenue to the fund.
In addition, it must contribute 2.0 per cent of PETRONAS dividends received by the Federal Government and 2.0 per cent of export duties collected on depleting natural resources, after deducting revenue assigned to state governments.
These represent minimum statutory contributions, with the Federal Government retaining the flexibility to make additional contributions at any time.
The Bill also introduces stricter rules governing withdrawals from the fund.
Funds may only be utilised for education, healthcare, and climate change mitigation and adaptation initiatives.
Annual withdrawals will be capped at no more than 50 per cent of the fund's expected long-term real rate of return, ensuring that the principal remains intact and continues to grow over time.
Any withdrawal exceeding the prescribed limit will require the approval of the Dewan Rakyat.
The legislation also modernises KWAN's investment mandate by allowing the fund to invest prudently across a diversified range of approved asset classes in accordance with a Strategic Asset Allocation framework approved by the Minister of Finance.
Finance Minister II Datuk Seri Amir Hamzah Azizan said the reforms reinforce the Government's responsibility to safeguard national wealth for future generations.
"The resources we enjoy today do not belong to us alone. We hold them in trust for future generations. Through this Bill, the Government is strengthening KWAN as an intergenerational savings fund by ensuring more consistent sources of contributions, more disciplined utilisation and stronger governance.
“This will enable more of the nation's wealth to be preserved and passed on to future generations of Malaysians," Amir said in a statement released by MOF on Friday.
The Bill will now be tabled in the Dewan Negara for further consideration. - July 17, 2026
