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Tuesday, 20 January 2015 | MYT 1:30 PM

Budget Revision: Government postpones electricity tariff hike

PETALING JAYA: The Government will be postponing the scheduled electricity tariff hike planned for 2015 in an effort to accelerate private investments, said Prime Minister Datuk Seri Najib Tun Razak (pic) on Tuesday. 

Najib, who announced revisions to the 2015 Budget, added that the scheduled gas price hike for the industrial sector would be postponed to reduce the cost of doing business. 

In November 2014, Energy, Green Technology and Water Minister Datuk Seri Dr Maximus Ongkili said that there would be no increase to the electricity tariff until June 2015. 

In January 2014, electricity tariff was increased by 4.99 sen per kWh from the 33.54 sen/kWh to 38.53 sen kWh.

Rates for Sabah and Labuan were increased 5.0 sen per kWh or from 29.52 sen per kWh to 34.52 sen per kWh.

"In efforts to accelerate private investments, the government will set up a Services Sector Guarantee Scheme amounting to RM5bil for SMEs in the services sector, with maximum financing of RM5mil and 70% government guarantee, and encourage government-linked companies (GLCs) to invest domestically," said Najib.

He added that 30% of the annual procurement budget of Government agencies and GLCs for goods and services be allocated to local SME producers.

Najib is adjusting Budget 2015, with both proactive and pre-emptive measures, in move to ensure sustainable development and resilience of the economy, with actions and policy interventions being set up to handle the changing economic scenario caused by the oil price slump.

When Najib, who is also Finance Minister, tabled Budget 2015 last year with an expected expenditure of RM273.9bil against an expected revenue of RM235.2bil, oil price averaged around US$90 (RM355) per barrel.

But the price has been falling and is expected to drop to as low as US$40 (RM140) in the first six months of this year.

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Tags / Keywords: Najib , Revision , Budget

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