KUALA LUMPUR: The government is maintaining its RM40 billion fuel subsidy commitment under the 2027 Budget to shield Malaysians from global oil price volatility and curb subsidy leakages.
Finance Minister II Datuk Seri Amir Hamzah Azizan said the government remained committed to targeted subsidies to protect the people from rising global prices while ensuring that assistance reached the intended beneficiaries.
He said economists, including from the International Monetary Fund and local experts, had proposed setting fuel and electricity prices according to market rates for all consumers, with cash assistance provided only to the poor.
“The government does not agree with this approach. We remain committed to continuing targeted subsidies to protect the people from rising global prices, while curbing leakages caused by smuggling and ensuring that subsidy benefits do not fall into the hands of non-citizens.
“Therefore, this commitment of nearly RM40 billion is necessary to protect the people,” he said when winding up the committee-stage debate on the Supply Bill 2027 in Dewan Rakyat today.
Amir Hamzah said, through Budi Madani, Malaysians continued to enjoy subsidised RON95 petrol of up to 300 litres at RM1.99 per litre, compared with the actual market price of RM4.42 per litre.
Subsidised diesel of up to 400 litres was available at RM2.10 per litre, compared with the actual market price of RM5.27 per litre.
Looking ahead to next year, he said there was still no certainty that the conflict in the Middle East would ease or that oil prices would return to stable levels.
“Therefore, the government must be prepared for all eventualities and make every possible effort to ensure that the people remain protected.”
On Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (Sara), Amir Hamzah said that, as at Oct 31, a total of RM12 billion had been channelled to eligible recipients.
“Nearly nine million recipients had used Sara, recording RM6.15 billion in transactions, representing a utilisation rate of 99.7 per cent.
“Meanwhile, Sara for All had been used by 20.6 million recipients, or 92 per cent of eligible users, with total transactions exceeding RM1.95 billion.”
On calls to reintroduce loan exemptions for students graduating with first-class honours from private higher education institutions, he said the government and the National Higher Education Fund Corporation (PTPTN) would study the proposal in line with the principle of targeted assistance.
“This is to ensure that PTPTN’s funds remain sustainable for future generations of graduates.”