PUTRAJAYA – Prime Minister Datuk Seri Anwar Ibrahim announced that the savings from targeted diesel subsidies will be redirected to the people, particularly through improved public transportation and the Rahmah cash contribution (STR).
Acknowledging that the targeted subsidy is not a popular move, Anwar, who is also Finance Minister, stated that the measure would result in savings of RM4 billion annually and has undergone thorough research at numerous levels before being implemented.
“The savings (from targeted diesel subsidies) will support public transportation needs.
“Imagine the STR for nine million recipients of direct cash subsidy, which amounts to RM10 billion. The funds from the targeted subsidy are not for increasing ministerial allowances or other interests, I focus on assisting the people,” he said during a gathering of Finance Ministry staff, here today.
The price of diesel at all retail stations in the peninsula was set at RM3.35 per litre starting yesterday (June 10), which is the unsubsidised market price based on the average for May 2024 according to the Automatic Price Mechanism (APM) formula.
Previously, Finance Minister II Datuk Seri Amir Hamzah Azizan was reported to have said that from now on, diesel prices would be announced weekly following the current practice of the Finance Ministry, with the government continuing to monitor the situation to avoid price instability.
However, he stated that the targeted subsidy does not involve Sabah and Sarawak.
Meanwhile, Anwar emphasised that the targeted diesel subsidy was implemented to ensure it did not benefit the very wealthy, as well as foreigners.
“I told the cabinet we need to make wise decisions, we must assist the majority of the people. We should not provide subsidies to the very wealthy, large industries, and foreigners.
“(This) is not discrimination against foreigners because foreigners do not pay taxes… the levy (they pay) is very little. Our main responsibility is to our citizens,” he said.
He noted that the implementation of targeted diesel subsidies has been well received by parties within the unity government and some opposition parties as well, and it will be monitored to prevent issues.
“So far, the statements from PAS leaders seem rather moderate, not opposing but merely monitoring. There are no issues because the opposition should monitor the implementation, and so should we.
“The subsidy (for diesel) is maintained for fishermen, public transportation, and around 30,000 smallholders, including vegetable farmers in Cameron Highlands, because we do not want it to be used as an excuse to raise prices,” he said.
He emphasised that the government has undertaken three targeted subsidy rationalisation measures, namely, electricity tariffs, floating chicken prices, and the recent implementation of targeted diesel subsidies, all of which are anticipated to result in savings of approximately RM10 billion.
“This is the third-largest step, the first being electricity tariffs which were less controversial because we benefited 85% of the population, it only affected the top 15% and foreigners, saving us RM4.5 billion annually.
“… we saved RM1.2 billion (with the floating of chicken prices). Meaning, political stability and firm political determination are important, that’s why I always link it to governance. Stop corruption because it helps us (and the nation),” he added. – June 11, 2024