THE government has postponed the petrol subsidy programme (PSP) because it needs more time to explain the mechanics to the people. 

Domestic Trade and Consumer Affairs Minister Saifuddin Nasution told The Malaysian Insight, many people were concerned that prices of goods would drastically increase if the price of RON95 were floated.

“When we explain that prices will increase by one sen a week, the public thinks that it will eventually rise by 52 sen in as many weeks,” he said

“But that doesn’t make sense as the world crude oil price is only around RM2.28 per litre.

“As such, the cabinet has decided to more time is needed to explain to Malaysians how the free float system works before implementing the PSP .

“The ministry has already identified the people who are eligible for the subsidy, taken down their data and dialogued with the petrol suppliers.

“But the cabinet felt that more time was needed so that the policy was clear and acceptable.”

The government has identified two categories of people on the peninsula who would benefit from the PSP, which it pledged to introduce during the general election.

The first category comprising recipients of the BSH (cost of living aid) will get a petrol subsidy of RM30 a month if they are car owners or RM12 a month if they own a motorcycle.

It has been explained that the subsidy would be dispensed in the form of quarterly cash transfers.

The first payment would be due in April 2020 if the proposal to introduce the scheme in January were to ahead as planned.

The second category of eligible motorists who are not BSH recipients would receive the Kad95, which would enable them to enjoy a fuel subsidy of 30 sen per litre up to 100 litres per month for car owners or up to 40 litres a month for motorcycle owners.

Kad95 was due to be introduced in the first quarter of 2020. – December 30, 2019.