ADUN SPEAKS | Reviewing fuel subsidy can shake economy

ADUN SPEAKS | In view of the government’s plan to review the current fuel subsidy mechanism, I urge the Finance Ministry (MOF) as well as other relevant ministries and agencies not to change or even terminate the fuel subsidy only for the sake of reducing government spending.

Such a major policy change might send shockwaves through the market and society.

Finance Minister Tengku Zafrul Abdul Aziz recently announced in Parliament that following the spike of world crude oil prices, the government had to cover a significant increase in subsidies up to 10 times, increasing from RM200 million for January 2021 to more than RM2 billion for January 2022. As such, the government will review the subsidy mechanism to be more targeted towards aiding the vulnerable groups.

Judging from the MOF’s statement, it appears that the government’s main purpose in reviewing the fuel subsidy is to reduce its spending.

The government might provide some extra subsidies to the vulnerable groups to call it a day, yet has no intention to study the...