Rafizi Slams Ron95 Subsidy As Vote Driven Shortcut

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Former economy minister Rafizi Ramli panned the new RON95 subsidy again, calling it pointless.
ADSHe criticised the government for "taking shortcuts" to gain votes through the Budi95 scheme, which grants Malaysians access to 300 litres of petrol at RM1.99 per litre per month.
"Our duty in the government is to make tough decisions," he said on the latest episode of his "Yang Berhenti Menteri" podcast last night.
On Sept 22, Rafizi warned that the fuel subsidy set to begin on Sept 30 could open the door to fuel reselling and other loopholes.
He added that subsidy rationalisation is a necessary step for fiscal sustainability, stressing that wealthier households currently benefit disproportionately from the blanket scheme.
The Pandan MP said that without subsidy rationalisation, for every RM1 of subsidy spent, T20 households will receive 75 percent more than B40 households.
Former economy minister Rafizi RamliEarlier that day, the government announced that it would not impose an income cap on RON95 subsidies, as it had previously indicated.
RM20b cost
On his podcast, Rafizi said the subsidy is likely to cost Putrajaya upwards of RM20 billion a year.
"The cost of the RON95 subsidy that the government has to bear will return to its original value of RM20 billion.
"Finally, at that point, we can ask ourselves, why did we bother to retarget this subsidy?" he asked.
He said that before this, the amount spent on fuel subsidies ranged from RM20 billion to RM25 billion annually.
On Sept 22, Finance Minister II Amir Hamzah Azizan said that the new projected savings under the Budi95 plan are between RM2.5 billion and RM4 billion annually, depending on crude oil prices.
ADSUp until August, the government had maintained that estimated savings from targeted RON95 subsidies would be up to RM8 billion.
Prime Minister Anwar Ibrahim had previously asserted that the “mahakaya” (rich elites) would not be entitled to fuel subsidies.
Bite the bullet
Rafizi lamented that the government's scrapping of its original RON95 subsidy rationalisation plans had marked the return of polemics on such exercises.
"So that's why my view from the beginning is that (we have to) bite the bullet. If you're going to do something, do it right," he said.
Besides that, Rafizi said that now plans have changed, the government will not be relying on data from the Central Database Hub (Padu), which was introduced in January last year.
"When the government made the decision to firstly, use identity cards, and secondly, not to use income caps, it meant that Padu would not be used as Padu was developed for cash transfers as per the initial decision in 2023," he explained.
The Budi95 scheme will probably rely on data from the Road Transport Department, he added.
However, he said Padu can be used for other purposes, as it is the most complete database when it comes to household information. - Mkini

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