Govt Rejects Floating Price Approach To Protect The People - PM Anwar

KUALA LUMPUR, Feb 11 (Bernama) -- The government has not chosen the floating price approach as recommended by the World Bank and several economic experts because it is considered to be burdensome for the majority of the people, said Prime Minister Datuk Seri Anwar Ibrahim.

Anwar, who is also the Finance Minister, said instead, the government implemented targeted subsidies that successfully protected 85 per cent of the people and saved RM6 billion for petrol and RM5 billion for diesel. He said the government also set the price of BUDI95 at RM1.99 per litre to ensure that fuel consumption continued to benefit the people overall.

“The use of (BUDI95) is smooth and orderly. This is a success story that we are proud of. A total of 3.1 million transactions a day were carried out well.

“Current use is around 100 litres, although we (the government) provide up to 300 litres, and 90 per cent of the people who use BUDI95 do not exceed 200 litres a month,” he said during the Minister’s Question Time in the Dewan Rakyat today in reply to a question from Fong Kui Lun (PH-Bukit Bintang) who asked the Finance Ministry to state the amount of savings achieved through the implementation of BUDI95 throughout 2025, the projected savings for 2026, and how the savings were used.

Anwar said it was good news for the country because not many countries dared to take a stand on implementing targeted subsidies given the risks and challenges in terms of public acceptance.

“However, Alhamdulillah, the move was successfully implemented and well received. Firstly, we don't have much choice because the leakage due to untargeted subsidies is too high.

“Secondly, we acknowledge that the current situation would be better if the implementation were done in phases without affecting the welfare of the majority of the people. That is the principle we hold," he said.

He said if the prices were to be floated, it was estimated that only families earning around RM13,000 a month and above would not receive assistance, while the rest would be given assistance.

Meanwhile, Anwar said smuggling syndicates to neighbouring countries had also been successfully curbed, and he appreciated the concern of the people who reprimanded and channelled information when there were attempts by foreigners to buy RON95.

“This attitude is commendable — not only defending the rights of Malaysians, but also reflecting the spirit of nationhood and identity,” he said.

He said the targeted RON95 subsidy was expected to save at least RM2.5 billion this year, subject to movements in world crude oil prices and currency exchange rates.

“The results of the fiscal savings have been redistributed to the people. These savings can finance additional assistance to the people, especially the Sumbangan Asas Rahmah (SARA),” he said.

After the implementation of BUDI95, overall leakage has been significantly reduced. However, he admitted that there are still some isolated cases that have been and are being identified.

“There are still cases detected at several petrol stations in border areas, including in Rantau Panjang, Tawau and Perlis, which show suspicious usage patterns.

“Those are the three areas that recorded the highest leakages, and surveillance and enforcement are now more focused on those areas to prevent loss of revenue,” he said.

-- BERNAMA