KUALA LUMPUR: The Cabinet agreed today to implement targeted diesel subsidy involving consumers in Peninsular Malaysia, Prime Minister Datuk Seri Anwar Ibrahim said.
He added that the targeted subsidy will not involve consumers in Sabah and Sarawak as it was used in nearly every family’s vehicle in both states.
“So, we will postpone any action (on targeted diesel subsidy for Sabah and Sarawak) as it will burden the people there,” he said during a live address to the nation broadcast by all local media channels tonight.
To curb drastic rises in prices of goods and services in the Peninsula, however, the government will prepare subsidies for traders using commercial diesel vehicles, he said.
Anwar also said that the subsidy would involve 10 types of public transport vehicles and 23 types of goods transportation vehicles under the diesel subsidy control system.
“This means that bus, taxi operators (and) fishermen will continue to be protected through subsidies or assistance that will help them. So, the government agreed to provide cash assistance to owners of private diesel vehicles that are eligible, (including) smallholders, farmers and traders.
“It is for the B40 (and) M40 (groups) who need to use diesel for their business or farming, mining, rearing livestock or fishing. This means (they) will not be impacted by this hike,” he said.
Anwar also said that the targeted diesel subsidy would not involve the T20 group and the 3.8 million foreigners, and would save the government around RM4 billion annually.
“I would like to stress here that we raise (introduce targeted diesel subsidy) but it does not (burden) the people. We raise the impact to the very wealthy and the foreigners.
“If there are people burdened by using diesel, there are avenues for them to refer to, the Transport Ministry or related ministry so that the targeted diesel subsidy will only impact the rich and foreigners and not burden the (people),” he said.
Anwar said that the government will improve the Sumbangan Asas Rahmah (SARA) programme by increasing allocations to RM700 million, a five-fold increase from RM130 million last year that will benefit 700,000 recipients with added assistance of RM1,200 compared to the previous RM600.
He said the allocation of the Rahmah Cash Assistance (STR) has also been raised by RM2 billion or by 25 per cent, to RM10 billion this year from RM8 billion last year which will benefit nine million recipients, roughly 60 per cent of Malaysia’s adult population.
“So we have to remember where we can increase (this aid)… it’s from the funds we saved through wasted subsidies that profit the wealthy and foreigners,” he said.
Besides this, the Prime Minister said that the Rubber Production Incentive was raised twice, first from RM2.50 a kilogramme (kg) in 2022 to RM2.70 a kg in 2023 and then to RM3 a kg this year, while the rate of the Rice Price Subsidy was raised from RM360 in 2022 to RM500 per metric ton in 2023.
