The Malaysian Government will be launching the targeted subsidy programme for RON95 fuel by the second half of next year, 2024 (2H2024), according to Economy Minister Mohd Rafizi Ramli, reported The Edge Malaysia.
The minister highlighted that 53% of blanket fuel subsidies have been benefiting the top 20% of income earners (T20), rather than the groups that actually need them. This has caused the system to be unstable and unfair, and thus a reform via the targeted subsidy programme.
The government will be implementing the targeted subsidy programme for both RON95 and diesel fuels using three mechanisms. This includes basing off individual net disposable income, net disposable household income through social protection or assistance schemes, as well as a combination of household and individual earnings, which will be carried out using a subsidy card.
Rafizi said in his opening address at the National Economic Outlook Conference organised by the Malaysian Institute of Economic Research (MIER), “The government will roll out a RON95 subsidy programme in 2H2024, as we look to optimise our resources towards those that need it most. I know analysts keep asking why it takes so long, because we’ve seen how it’s done in other countries. The sequencing is important, which means getting everything ready. Once we roll it out, it is expected that there will be unhappiness here and there, there will be teething problems, but we can’t afford the U-turn.”
Prior to this, the government announced that it would most likely be introducing the targeted subsidies for RON95 and diesel fuels sometime next year, and this will take place after the launch of the National Central Database (PADU).
During the Budget 2024 announcement last month, Prime Minister Datuk Seri Anwar Ibrahim laid out the details of the targeted diesel subsidy policy. The policy will be carried out in phases, and will be made available to selected consumers only such as goods transportation companies.
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