Extra RM4bil subsidy if no petrol price adjustmentsKUALA LUMPUR: The fuel subsidy is estimated to rise by an additional RM4bil this year if no adjustments are made to petrol prices, which stand at RM1.90 per litre for RON 95 and RM2.50 per litre for RON 97.
Prime Minister Datuk Seri Najib Tun Razak said at a press conference Wednesday, after a briefing by Bank Negara Governor Tan Sri Dr Zeti Akhtar Aziz, that subsidy costs for fuel would rise by this amount if no adjustments were made in the face of higher crude oil prices.
This would mean that the allocation for fuel subsidy under Budget 2011, which was set at RM10bil based on oil prices hovering around US$85 (RM259) to US$90 (RM274) per barrel, would rise to RM14bil this year.
Besides this, the Government has also allocated RM4bil for other subsidies. For 2010, the fuel subsidy came up to RM10bil.
Economists have also estimated that should oil prices remained above US$100 (RM305), the Government might need to fork out an additional RM3.5bil to RM4bil for the fuel subsidy.
Najib added that the deficit would depend on how much revenue the Government would get against the increase in subsidy costs.
The Government has targeted a budget deficit at 5.4% of gross domestic product for this year compared with 5.6% last year while the target was to lower the deficit to 2.8% by 2015.
Last month, Najib said there could be a review of the fuel subsidy should unrest in the Middle East continued although, so far, there were no plans to do so.
The price of RON 97 petrol was last raised on Feb 1, up from an initial 10 sen hike on Jan 4. In December, RON 95 petrol and diesel rose 5 sen per litre to RM1.90 and RM1.85 per litre respectively.
tunku : we understand the government position on this issue. if the government increases the petrol prices than the people would not be happy and might go against the government but the people should think about the country too sometimes.4 billion is not a small sum.lot of rural development projects can be done with that amount.my suggestion to the government is that they should increase Ron97 even to RM3 but hold on to Ron95 and diesel as long as they can.we know all the Ron97 users are rich people so they can afford to pay for it.
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The way to save money is to keep an eye on Gvernment contracts and cost overruns.At the moment they are on steroids and beyond control because the people involed are all friends and relatives. You see success is relatve and when you brcome more successful you get more relatives.In many countries the consultant who does the drawings of the project is not allowed to e the cntractor. Here I am told the two are actually the same person. There are many ways to sae money. Employ those who retired PTD officers around 2000 and live in modest houses in KL they will help you. Thank You
anon 5.05am,
it easy to say or to tell base on "stories". i have not come across of any consultant of a project is also the contractor.can you name one?
as for keep an eye on contracts, they are open to be investigated if someone reports with evidence.there is, we are not saying there is none but those who have the info pls produce evidence to MACC.we too want this thing to be dealt with.
Only the Government can be its own watchdog. "if someone reports" that someone has no access to the relavant iformation because most, if not all, of it is in the hands of the government and protected by OSA.Thank You
another bull s by anon
'we know all the Ron97 users are rich people so they can afford to pay for it.' Just goes to show the world of the UMNO/Perkosaputras is very far removed from the daily lives of Malaysians. Many old cars on the road especially old Protons need to run on RON 97 petrol to prevent severe engine knock which can destroy the engine. Proton claims all Proton cars can run on RON 95 petrol. This is only true when the Proton cars are below 10years old. Above one decade the build up of carbon and the formation of hotspots in the engine increases the compression ratio of the engine thereby making making RON 95 petrol inadequate to prevent engine knock. All engines will exhibit very mild engine knock under certain conditions. However, severe engine knock will eventually destroy the engine. The solution is to either overhaul the engine or get another car. Both solutions do not exist for millions of Malaysian working stiff. If UMNO truly wants to help the poor then UMNO should institute an end-of-life policy for the car and motorcycle sector whereby existing vehicle owners get cash or rebates when they trade in their old junk at a particular minimum age. Free float petrol and diesel prices gradually at the same time so as to encourage fugal driving habits. Taxes for cars and motorcycles should also be reduced. Finally, the very poor which are invariably also small motorcycle riders should still have access to subsidized petrol of RON 86 or even lower. Most small motorcycles of 150cc and below are able to run on very low octane petrol. Limitations can be placed on the amount an individual can purchase of such RON 86 petrol. Most petrol stations already designate certain pumps for motorcycles only. Thus monitoring the sale of subsidized petrol at these pumps is made easier. Stop your arrogant rubbish and look at Malaysians without your 'aku kaya awak mampos siapa peduli' eyes for a moment. Nahhhh! It ewill never happen.
malaysian must learn how to live without subsidized goods. learn like china and india.how they survive
Dear Normala,
Please attack the messasage. Using unparliamentary language does not mean you have had your day. This quote may help us understand the divided politics in our country today.
" The most difficult subjects can be explained to the most slow-witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows alredy, without a shadow of doubt, what is laid before him" Leo Tolstoy 1897
dey vinnan hindraf doing what? barking barking allthe time.here we talk abt petrol issue(world issue) n u stupid moron want to talk abt umno.idiot.
dey anon,
that words suits u.
Hello Vinnan,
Barking at the wrong tree! Typical of the opposition's psychological state of mind when they cannot differentiate between the party and Government. This condition is also known as Paranoid Personality Disorder and I can detect majority of the oppositions in Malaysia are suffering from this serious condition. My prognosis is a grim future for the country if we allow these zombies to rule us.
Increasing 5 cents on Ron 97 does not hurt the rakyat at all. But it saves a lot on subsidy.
Come on man be a little patriotic like the Koreans and the Japanese.
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