Malaysia’s targeted diesel subsidy rollout reduces monthly sales by 305 million litres, saving RM400 million monthly and curbing commercial leakages.
KUALA LUMPUR: The sale of subsidised diesel has recorded a significant decline since the implementation of the targeted diesel subsidy programme in June 2024, indicating that the government’s efforts to curb subsidy leakages are showing positive results, said Deputy Finance Minister Lim Hui Ying.
She said that before the implementation of the initiative, the average monthly sale of subsidised diesel between January and May 2024 was around 770 million litres, adding that after the policy took effect, the average monthly volume from June to December 2024 declined to about 465 million litres.
At the same time, she noted that commercial diesel sales have risen since the implementation.
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“The comparison between the two periods shows a significant drop in subsidised diesel sales, indicating a corresponding decline in subsidy leakages.
“This suggests that previously, subsidised diesel purchased from petrol stations may have been used for local commercial purposes, such as to power machinery and electric generators at construction sites or factories,” she said during the question-and-answer session in the Dewan Rakyat today.
Lim was responding to a supplementary question from Chong Chieng Jen (PH-Stampin) regarding the decline in subsidised diesel sales following the implementation of the fuel subsidy rationalisation.
She noted that since the subsidy rationalisation was implemented, the government has achieved monthly savings of over RM400 million, amounting to approximately RM5 billion annually.
“The savings allow the government to reallocate funds to finance development projects and strengthen social support networks for the public through cash assistance programmes such as Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA),” she said.
She stated that as of Oct 31, approximately 320,000 beneficiaries, including private diesel vehicle owners, farmers, livestock breeders, and smallholders, had received a total of RM850 million in payments.
“For the land goods transport segment under the Budi MADANI Diesel programme, as of Sept 30, a total of 121,618 companies operating 355,074 vehicles had been approved for fleet card usage.
“This measure helps ensure that operating costs in the logistics sector do not surge and that essential goods remain reasonably priced, while demonstrating effectiveness in reducing leakages, optimising fiscal expenditure, and ensuring that eligible groups continue to benefit,” she said.
On diesel subsidies for fishermen, Lim said approximately 18,000 fishermen registered with the Malaysian Fisheries Development Authority, including inland fishermen registered with the Department of Fisheries Malaysia, are eligible for the targeted BUDI MADANI RON95 (BUDI95) subsidy.
“This also includes privately-owned boats registered with the Sarawak Rivers Board, Ports and Harbours Department of Sabah. All of them are eligible to receive BUDI95, which was launched in October,” she said.
