PUTRAJAYA: A stronger social protection system must exist to complement the targeted subsidy programmes that will be put in place, says Datuk Seri Dr Ahmad Zahid Hamidi.
The Deputy Prime Minister said care must also be exercised in implementing this as it would have an effect and impact on various groups in society and economic sectors.
“The implementation of a targeted subsidy is not easy and it will certainly come with challenges.
“The government will continue to put in place initiatives and mechanisms to ease public concern in facing cost of living challenges,” he added.
Ahmad Zahid said having a strong social safety net must be explored so that the interests and the welfare of the vulnerable would not be affected by targeted subsidies.
“If we have a strong social safety net and an effective targeted subsidy implementation, I believe we can put an end to the need for Employees Provident Fund withdrawals for emergencies.
“This kind of framework, if in place, will be able to help Malaysians go through difficulties, be it during crises or normal times,” he said when launching the Symposium on Cost of Living 2023 yesterday.
His speech was read by acting Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali.
The Deputy Prime Minister said while subsidies had managed to stabilise prices, guarantee supply and reduce the burden of the rising cost of living, it had also benefited those in the high-income group and non-citizens.
He pointed to the findings of two studies that those in the T20 household income group spend RMM399 a month on RON95 petrol while those in the B40 group use an average of RM243 worth of petrol a month.
“This shows the blanket method of subsidy does not meet its basic objective as the target group which is supposed to be assisted does not get optimum benefit from the subsidy,” he said.
Ahmad Zahid said the diesel subsidy, which was meant for fishermen as well as consumers to get “value for money” for the goods and services they pay for, was also abused by irresponsible parties.
“We are all aware that because there is a blanket subsidy for diesel, it creates an opportunity for leakages, resulting in misappropriation and smuggling.
“It is not reasonable for the government to continue with an approach that is obviously unfair to those who truly need the assistance,” he said.
Ahmad Zahid said that as a responsible government, measures must be taken to improve the delivery of aid and ensure it was more targeted.
Meanwhile, Armizan also echoed the need for an effective social security system as the government rolls out target subsidy programmes.
“Social aid must be holistic because we want to ensure no one is left behind and those in the vulnerable group will not be overly impacted by this,” he said.
Meanwhile, Armizan said the symposium provided stakeholders, government agencies, non-governmental organisations, industries as well as the public with the opportunity to voice their concerns on the implementation of targeted subsidies.