KUALA LUMPUR: The government needs to ensure that the impact of targeted diesel subsidies stabilise before it moves on to rationalisation of RON95 subsidies, Finance Minister II Datuk Seri Amir Hamzah Azizan said.
He said the focus for now is on the implementation of targeted diesel subsidies, as the implications and the strategies need to be considered.
He was responding to media on the timeline for targeted subsidies implementation for RON95.
"The goverment's efforts for now are to increase people's understanding of why subsidy solutions are carried out and also encouraging those who are eligible to apply for the Budi Madani system, Amir Amzah said to the reporter after delivering his keynote address at the Sasana Symposium 2024 organised by Bank Negara Malaysia (BNM) here today.
He emphasised that public transportations operator can still buy diesel at subsidised prices, which includes express bus, school bus, ambulance, as well as logistics transportation companies.
"Therefore, the impact on the price of goods will be controlled because they also purchase fuel at a subsidised price," he added.
Amir Hamzah said monthly cash transfers of RM200 through Budi Individu and Budi Agri-Komoditi, will also help to reduce the people's burden.
"The implementation of targeted diesel subsidies reduces leakages in the country, avoiding subsidies go to neighboring countries and sectors that are not entitled to subsidies," he said.
Based on initial information received from oil companies, Amir Hamzah said the volume of diesel at stations located at the border of the country has declined.
In his keynote address, Amir Hamzah also said the estimated RM4 billion savings from targeted diesel subsidy will be re-invested on building a better infrastructure, education and health system.
"In the long run, targeted subsidies promote more sustainable and efficient use of resources and optimise government spending on social assistance," he added.