![Government cancels Petrol Subsidy Programme for B40 / M40. Fairer for the T20 class? 01]()
The Domestic Trade and Consumers Affairs Ministry (KPDNHEP) and the Finance Ministry (MoF) have announced that they will not be implementing the petrol subsidy programme (PSP).
Deputy Minister of KPDNHEP Rosol Wahid said that both ministries have come to an agreement not to implement PSP due to several reasons.
According to Rosol, the first and foremost reason is to avoid misunderstanding among Malaysians as the PSP will only apply to residents in Peninsular. Residents in Sabah, Sarawak, and the Federal Territory of Labuan will not be affected by the programme.
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Secondly, not employing the programme will also avoid creating a wide gap in petrol prices between Peninsular Malaysia and Sabah, Sarawak and Labuan.
PSP was first announced back in October 7, 2019. The programme involves an allocation of RM 2.4 billion under Budget 2020. It was expected to benefit 8 million people in the B40 and M40 groups.
One more reason that Rosol stated was that the programme would easily raise doubt among people on the transparency of the subsidy scheme due to certain aspects.
An example he gave was the fact that the M40 group would enjoy discounts when filling up by using a petrol subsidy card.
It was reported that RON 95 petrol consumption in the country was around RM 14.4 billion litres per year. This means that if the programme is implemented, the amount that the government will have to bear for just RON 95 alone would be a total RM 4.32 billion annually.
MoF has set the ceiling price for RON 95 at RM 2.08 per litre. Currently, the price of RON 95 is retailed at RM 1.68 per litre for this week.
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