Diesel subsidy rationalisation timeline on hold to avoid speculative inflation

PUTRAJAYA: The government will announce the timeline for the rationalisation of diesel subsidies when it is ready as it wants to avoid speculative inflation, said Economy Minister Rafizi Ramli.

He said one of the main considerations was the need for proper sequencing in implementing the diesel subsidy rationalisation that would ensure a balance between wage growth, increasing public income and inflation.

While the rationalisation was slated for this year, it may take some time, with the final decision to be made by the Cabinet, Rafizi said, adding, “(It will happen) because a lot of work, discussion and coordination have been done”.

“The plan began with Padu (Central Database Hub), which was to guarantee data availability when the government decides to take action.

“The data is ready, awaiting the government’s decision on the mechanism to employ.

“We’re working to avoid speculative inflation,” he told reporters here yesterday when asked about updates on Padu and the rationalisation of diesel subsidies.

Regarding Unicef Malaysia’s (United Nations Children’s Fund) suggestion to set RM2,102 as the minimum wage, Rafizi said Putrajaya would consider the proposal, adding that the government is focused on addressing cost of living issues by reviewing civil servants’ salaries and implementing the progressive wage policy project.

“We are the most focused on salary-related issues compared to previous administrations.”

On May 8, Unicef said the current minimum wage of RM1,500 is too low for workers to sustain themselves and their families, based on a newly-published report titled “Living on the Edge: Longitudinal Study on Post-Covid-19 Impact Assessment Among Low-Income Households in Kuala Lumpur”.

Rafizi pointed out that any policy implementation regarding wages must include all relevant stakeholders, not just the employers.

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