60,000 tonne quota for subsidised cooking oil enough for locals, not foreigners, says Fuziah

KUALA LUMPUR: The quota of 60,000 metric tonnes of subsidised cooking oil a month is sufficient if used solely by locals and not foreigners, says Fuziah Salleh.

"Previously, we had initially calculated that 70,000 metric tonnes of cooking oil was needed if based on 60,000 metric tonnes of non-targeted subsidised cooking oil.

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"But with the government's new policy of not wanting foreigners to benefit from the subsidy, 60,000 metric tonnes (a month) would be sufficient," the Deputy Domestic Trade and Cost of Living Minister said when answering a supplementary question raised Bakri Jamaluddin (PN-Tangga Batu) in the Dewan Rakyat on Monday (Nov 27).

She said that a total of about 5.8 million households, comprising those from the B40 and a portion of M40 groups including 91,860 mirco-traders will be eligible for the targeted subsidised packet cooking oil when implemented next year.

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She added that the improved Cooking Oil Price Stabilisation System (eCOSS) system and data from the National Utility Database would be used for the implementation of targeted subsidies for cooking oil.

Fuziah acknowledged that the previous eCOSS system only tracked subsidised packet cooking oil from refinery to sundry levels, resulting in incidents of leakages.

She said the inproved eCOSS system will be able to track the subsidised packet cooking oil to targeted households or micro-traders.

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She said that it was calculated that households needs about 4.8kg of cooking oil per month while micro-traders use about 400 packets per month.

There had been calls for the government to increase the subsidised cooking oil by at least 10,000 metric tonnes a month.

Meanwhile, Datuk Seri Johari Abdul Ghani (BN-Titiwangsa) suggested that implementing direct cash transfers to accounts of those eligible.

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“If every B40 household uses about 5kg of cooking oil a month, we can allow them to continue purchasing at RM2.50 per kg by giving cash transfers for the difference between the market price (and the subsidised price),” he proposed.

He said that such an approach would see cooking oil packets sold at the market rate while saving the government billions by preventing leakages.

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Johari said there have been instances where subsidised packet cooking oil being sold to micro-traders at a high price by wholesalers while some are being used as bio-fuel.

Fuziah took note of Johari's suggestion, saying that it "may be the best way” to avoid leakages in the subsidy for cooking oil.

However, she said there is no mechanism at the moment for such a move although it was the direction which the government is heading too.