KUALA LUMPUR: More than RM208bil has been allocated for subsidies, assistance and incentives in efforts to stabilise the prices of selected essential goods and services.
Deputy Finance Minister Lim Hui Ying told the Dewan Rakyat that targeted allocations from 2023 until this year, which applied to certain goods and services, were implemented to ease financial pressure on low and middle-income groups.
She said the government found that blanket subsidies covered those who were ineligible for the assistance, and smuggling of subsidised items was also detected.
“Due to such leakages, the government decided to begin targeted subsidies in 2023 to ensure that assistance reaches those who genuinely need it while freeing up funds for programmes that directly benefit the public.
"Targeted subsidies ensure that assistance goes to the deserving. The savings also allow us to strengthen programmes that have a direct impact on the rakyat," she said during the oral question and answer session on Tuesday (Nov 18).
Lim was responding to Dr Halimah Ali (PN–Kapar), who wanted to know the steps taken by the government to ensure that the rationalisation of petrol, electricity and essential goods subsidies did not burden B40 and M40 households, as well as the projected price effects before and after implementation.
She said 85% of Malaysians continue to benefit from electricity subsidies under the targeted structure, while the decision to float the prices of chicken and eggs did not affect the supply of the two items in the market.
On the targeted diesel subsidy rationalisation, Lim said fleet cards were issued to more than 122,000 companies covering 359,004 vehicles.
Commercial users eligible for the fleet cards can purchase diesel at a subsidised rate of RM2.15 per litre.
"A total of 320,000 private diesel vehicle owners, farmers, breeders and smallholders also receive RM200 in monthly cash assistance.
“Malaysians aged 16 and above continue to enjoy subsidised RON95 petrol at RM1.99 per litre, with BUDI95 expanded to include registered fishermen, private boat owners in Sabah and Sarawak, as well as e-hailing and airport taxi drivers," she added.
Lim also said that these measures had kept inflation in check at 1.8% in 2024, with projections remaining stable at between one and two per cent this year.
She said the projections for inflation for next year should be between 1.3 and 2%.
Lim added that the savings collected from subsidy rationalisations have led to increased allocations for welfare and cost-of-living support programmes, which included RM15 billion for Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (Sara), including an additional one-off RM2 billion Sara payment.
"Allocations for Social Welfare Department assistance have increased to RM2.9bil, while RM1bil has been set aside for cost-of-living initiatives such as the Jualan Rahmah Madani programme.
"Other programmes funded through the savings include the RM791mil Early Schooling Assistance, the RM216 million My50 monthly travel pass in the Klang Valley, and RM200mil for BAS.MY's 30-day and concession passes, now expanded to Sabah and Sarawak,” she said.
