PH’s Petrol Subsidy Programme Scrapped

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The government has decided not to proceed with plans to implement the Petrol Subsidy Programme (PSP) which was mooted by the then Pakatan Harapan administration.

Domestic Trade and Consumer Affairs Deputy Minister Rosol Wahid said that his ministry and the Finance Ministry have agreed not to implement the PSP after considering the price difference of fuel between the peninsula and East Malaysia, among other factors.

“On July 9, the two ministries held a meeting on the PSP and agreed that we will not be implementing it.”

Rosol was responding to a question from Shaharizukirnain Abd Kadir (Pas-Setiu) on the new implementation date of the PSP.

“The reasons for not implementing the PSP are, first, to avoid misunderstanding among residents of Sabah, Sarawak and the Federal Territory of Labuan because only people in Peninsular Malaysia would be involved in this subsidy.


“And (second) to avoid creating a wide gap in petrol prices between Peninsular Malaysia, and Sabah, Sarawak and Labuan,” he told the Dewan Rakyat.

The programme was first announced on Oct 7, 2019, by former minister Saifuddin Nasution who said that under the Budget 2020 presentation, the government had allocated RM2.2 billion for the scheme.

However, on Dec 18, 2019, the cabinet decided to indefinitely defer its implementation which had been scheduled to take off in January this year.

The decision to not proceed with the PSP was also to avoid creating doubts among the people on the transparency of the subsidy scheme, Rosol added.

He said one aspect which could give rise to such doubts was the fact that the M40 group would enjoy discounts when filling up their tanks using a petrol subsidy card.

The allocation was expected to benefit eight million people in the B40 and M40 groups.