Gov’t should increase price of RON95 by 10 or 20 sen instead of completely removing subsidies – Najib

Former prime minister Datuk Seri Najib Razak has called on the Malaysian government to slightly increase the price of RON 95 petrol instead of completely abolishing fuel subsidies.

In a Facebook post, the Pekan MP sugessted that the slight increase in the price of RON 95 petrol, along with the collection of export duty from palm oil and the removal of subsidies from chicken and eggs, could see savings and revenue that can be channelled to the B40 and M40 income groups.

“It is not appropriate to fully remove subsidies on oil right now with the presently high global inflation rates at the moment. However, do not touch the price of diesel at the moment when inflation is still high as is correlates with the cost of production [and] transportation which could eventually put more pressure on the inflation rate,” Najib said.

Savings from the changes can be channelled to the B40 and M40 income groups every three months as a “cost of living” aid, suggested Najib, for as long as the inflation rate remains high.

“The T20 folks would not bother and are not affected if prices of food shoot up, but it will be a major burden for the B40 and a majority of the M40 group. The financial aid would certainly ease pressure from the cost of food for the B40 and M40 groups,” Najib said. These suggestions were based on his belief that the current bulk subsidies only benefit the rich, he added.

“The 65% reduction for the sales of RON 97 petrol is proof that most of the rich and well-off have switched to RON 95 to enjoy the government’s subsidy. This is akin to the rich obtaining their necessities from a food bank,” he said.

Currently, the government subsidises RON 95 petrol at a rate of around RM2.50 per litre, which has been sold at the ceiling price of RM2.05 per litre since February 2021, said the former prime minister. As such, someone of the T20 income group who refuels their vehicle with 50 litres of RON95 petrol gets a subsidy of RM125 for that volume of fuel purchased, said Najib.

“If the rich fill their vehicles [with RON 95 petrol] three times a month, it means the government is providing aid of up to RM4,500 a year for them, which is much higher than the BR1M aid for the B40 and M40 [during the Najib administration],” he said.

What do you think, readers? Do you agree with the former prime minister’s observations?

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