Malaysia’s RON95 fuel subsidy rationalisation takes longer time for careful implementation to prevent negative impact on the people.
KUALA LUMPUR: The government is taking more time to implement RON95 fuel subsidy rationalisation compared to other subsidies to ensure careful execution without negatively affecting the people.
According to the Ministry of Finance, detailed studies on the BUDI MADANI RON95 implementation approach are necessary since RON95 petrol is widely used and represents a significant household expenditure component.
Coordination between government agencies and oil companies down to petrol stations nationwide is receiving thorough attention.
System preparations and testing are being conducted to ensure a smooth user experience during implementation.
The ministry provided this explanation in response to Datuk Seri Dr Shahidan Kasim’s query about the delayed petrol price announcement.
The phased approach allows the BUDI95 programme to build on lessons from last year’s successful BUDI MADANI Diesel implementation.
This method enables the government to improve and strengthen the targeted subsidy mechanism for greater efficiency and effectiveness.
The reduced subsidised RON95 price of RM1.99 per litre will deliver benefits directly to the people.
Since 2023, the government has gradually implemented various subsidy retargeting measures including electricity subsidies and chicken and egg price flotation.
Targeted diesel subsidy and electricity tariff restructuring have also been part of the gradual implementation approach.
These measures aim to sustain the national economy while reducing leakages from subsidised goods smuggling.
The government ensures subsidy benefits reach only eligible groups through these targeted approaches.
Gradual implementation emphasises achieving savings without burdening ordinary citizens.
This approach successfully contained the 2024 inflation rate at 1.8% compared to 2.5% in 2023.
The inflation rate further declined to 1.3% in the third quarter of 2025. – Bernama
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