We must think of the poor, say consumer groups

  • Nation
  • Saturday, 22 Nov 2014

PETALING JAYA: The removal of fuel subsidy will hit the poor and middle-income earners, say consumer groups.

Fomca said that without a safety net, those in the poor and lower middle class would feel the pinch.

“In the long term, we are all for subsidy rationalisation and market forces deciding prices, but what are the options given to the poorer groups? Public transport should be efficient and reliable before such a change is made,” said Fomca secretary-general Datuk Paul Selvaraj.

“They will be badly affected as salaries are not going up. With the coming general sales tax, 2015 is going to be a tough year.”

He suggested a contingency plan to protect these groups.

“For example, there could be a cap so that if prices skyrocket, there will be a cushion. The Government should also keep the option of reinstating subsidies.”

Consumers Association of Penang research officer N.V. Subbarao said a study should be carried out to anticipate the impact on the poor.

“The Government has to work out a plan. When it gave subsidies, the rich enjoyed it.

“Now we need to help the poor, like the fishermen or rubber tappers.

“Subsidies should be removed and that has always been CAP’s stance, but there is no denying the poor will suffer, and they must be helped.”

Lorry and bus operators are also anxiously awaiting the Dec 1 fuel price adjustment to re-evaluate their costs.

Former Pan-Malaysia Lorry Owners Association president Er Sui See said that it was not fair for the Government to remove the subsidy, given the current market price of diesel fuel.

“If the Government does not subsidise fuel, transport costs will rise and everything will go up,” he said.

Er said lorry drivers took pains to charge competitive rates, but if diesel was no longer subsidised, costs could go up by at least 10%.

Alvin Choong of the KL Selangor Lorry Association said removing subsidies was a good measure “in the long term” but operating costs could go up by between 8% and 12% for operators to maintain their profit margins.

Related stories:
Prices for RON95 and diesel to be determined by float system
Analysts: Subsidy removal a good move

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Opinion , subbarao , cap , fomca


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