THE existing diesel subsidy system will continue and will be improved by ensuring that vehicles that transport diesel supplies from fuel stations or skid tanks are equipped with a “fleet card” system to monitor diesel consumption and avoid leakage, Prime Minister Anwar Ibrahim said.

Speaking in a press conference after chairing the National Economic Action Council today, Anwar, who is also the finance minister, said the country’s diesel subsidy system should be improved following the country’s subsidy liability jumping to RM13 billion last year.

He said a review showed the use of diesel jumped 37.7% from 6.1 billion litres in 2019 to 8.4 billion litres in 2022, while the number of registered vehicles that use diesel on increased by 2.4%, which is from 2.08 million in 2019 to 2.13 million in 2022.

“So there is a problem of misuse, smuggling and leakage. A leakage of RM10 billion.

“The diesel subsidy will continue, but it must be through the fleet card. This way we can see who can use it, and don’t to sell the diesel to factories, as is happening now,” he said.

He also said the government is identifying the types of vehicles that will enjoy the subsidy.

“We are detailing which vehicles need the diesel subsidy but the subsidy amount will not be raised.

“We just want to determine who is entitled to get subsidised diesel. We don’t want taxpayers’ money paid to help the people but used by certain quarters, such as the cooking oil cartels, for the benefit of a few,” he said.

Anwar said the government had started implementing a subsidy targeting programme in stages starting January 2023, when it announced it would no longer provide full electricity tariff subsidies to large companies that use a large amount of electricity. 

He said targeted and sustainable subsidy management is a priority in ensuring government spending is channelled to development needs that can provide higher added value to the national economy. – Bernama, May 15, 2023.