Current Government Scraps Proposed Petrol Subsidy Programme

The subsidies would’ve benefitted the B40 and around five million middle income earners earning under RM4,000

  • By: Dinesh
  • Wednesday, 29 July 2020
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Current Government Scraps Proposed Petrol Subsidy Programme
Behind the Wheel

Yes, we know it's a Euro 5 diesel pump but we didn't have any other photo in the library.

The proposed petrol subsidy programme (PSP) first mooted by the Pakatan Harapan government will not be implemented under the current Perikatan Nasional ruling, as decided by the Domestic Trade and Consumer Affairs Ministry as well as the Finance Ministry (MoF) and announced during today’s Dewan Rakyat session.

Shaharizukirnain Abd Kadir (PH-Setiu) has brought up the topic of the PSP’s implementation and Deputy Minister of Domestic Trade and Consumer Affairs Rosol Wahid replied, confirming the scrapping of the programme.

The decision had been reached during a meeting between the two aforementioned ministries on 9 July 2020 with the MoF being delegated the task of preparing the Cabinet Memorandum on the government's stand regarding the PSP.

“The reasons for not implementing the PSP are first, to avoid misunderstanding among residents of Sabah, Sarawak and the Federal Territory of Labuan because only people in Peninsular Malaysia would be involved in this subsidy,” said Rosol.

“And to avoid creating a wide gap in petrol prices between Peninsular Malaysia, and Sabah, Sarawak and Labuan,” added the deputy minister.

Rosol added that implementing the PSP would’ve created doubts among the public regarding its transparency as the M40 group of middle-income earners were also able to benefit from the subsidies using the subsidy card to fill up petrol.

Prior to this, the ruling government had decided to indefinitely defer the implementation of the PSP initially scheduled for January 2020.

First mooted on 7 October 2019, the PSP would consume RM2.4 billion from Budget 2020 to allocate subsidised RON95 petrol for the B40 group and a portion of the M40, benefitting around eight million people in total from the Peninsular side.

The ceiling price of RON95 has been set at RM2.08 per litre by MoF although the current pricing is RM1.68 per litre.

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