Govt to focus on targeted diesel subsidy initiative for now

Not affected: Students waiting for the school bus to take them home on Jalan Lintang, Seremban. School bus operators are enjoying targeted subsidies. — Bernama

KUALA LUMPUR: The government is focusing on the implementation of the targeted diesel subsidy initiative before it decides to move on to other related matters, says Finance Minister II Datuk Seri Amir Hamzah Azizan.

“We are only focusing on (targeted) diesel subsidy for now and once there is stability, we will look at what can be done next,” he told reporters on the sidelines of the Bank Negara Malaysia Sasana Symposium 2024 here yesterday.

He was responding to questions on the timeline for targeted subsidy implementation for RON95 fuel.

Amir Hamzah said diesel subsidy reforms were not taken lightly by the government and needed to be well thought out.

“It is very important to think about how we can do this and how it will impact the people.

“The reform agenda under the Madani framework is aimed at building Malaysia’s future and reducing the fiscal deficit so we can reinvest into things that are important,” he said.

Amir Hamzah said the targeted subsidy policy mechanism was done to cushion any possible increase in the prices of daily necessities.

“It is also aimed at keeping profiteering at bay while protecting the vulnerable segments of society from price hikes.

“Over time, there has been leakage of subsidies caused by smuggling of petroleum products and subsidies enjoyed by sectors who do not deserve them,” he said.

Amir Hamzah said that there had been a drop in the purchase of diesel at fuel stations located at the country’s borders following the implementation of the diesel subsidy rationalisation.

It meant that the government’s initiatives were working, he added.

Amir Hamzah said the government wanted to help sensitive sectors which use diesel and asked those who had not applied for Subsidised Diesel Control System (SKDS) 2.0 to do so.

SKDS is a specific platform for selected public and goods vehicles to continue receiving diesel subsidies through the fleet card.

“Operators of public vehicles like school buses, ambulances and others will still receive subsidies. We’re doing this to control the overall impact,” he added.

Amir Hamzah said for those who have reached their SKDS 2.0 quota, the government is ready to hold further discussions on it.

“Any sector that qualifies for the subsidies and has reached their limit can discuss with the government. If there is sufficient data to show this, we can help them,” he said.

The government announced that the retail price of diesel in Peninsular Malaysia has been set at RM3.35 per litre effective June 10 under the targeted subsidy system.

The weekly retail price of unsubsidised diesel will subsequently be announced every Wednesday, based on the formula.

For those in Sabah, Sarawak and Labuan, the price remains at the subsidised rate of RM2.15 per litre.

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