Gerakan Youth today expressed its disappointment with the government for hiking the prices of petrol and diesel in a hard-hitting statement released today.

"We are saddened by the fact that the Barisan Nasional (BN) government has to resort to such strategies to balance the fiscal policies of the country," said deputy chief Lim Si Pin, who is son of party leader Lim Keng Yaik.

"Even though, in the long-term it may be of benefit to the country as a whole, the sharp increase in the retail prices of fuel does no good for the country but will only burden the rakyat."

Apart from affecting the livelihood of the masses, the increase will also indirectly affect the rest of the population via the multiplier effect, he noted.

"Not only are transportation costs going to be more expensive, but all other consumables will be equally affected, only multiplied much more adversely through the chain effect," he said.

He added that if the RM4.4 billion savings in petrol subsidies is used to improve the public transportation system, then the government must ensure that consumers do not pay more in fares subsequent to the 30 sen price hike. To do otherwise would defeat the purpose of saving subsidies.

"If a consumer has to pay more to take the 'infamously inconvenient' public transport as compared to driving, then even improving the public transportation system will not attract the masses to use it.

"And when consumers don't use the public transport system, it would be unprofitable to operate public transportation."

Money going to MAS?

The government should also make sure that the subsidies saved are not used to bail out unprofitable government operations, for example Malaysian Airlines (MAS).

"If MAS made a loss of RM1 billion in the preceding year, than even the RM4.4 billion savings can only last the government for four years. In the end, nobody benefits. But the damage will be done and the top management of MAS or whoever is responsible, goes scot free."

He also said the government must not make "empty promises" that there will be no more price hikes of fuel for this year.

In awarding tender projects to concessionaires to operate any form of public transportation improvement projects, the government should ensure transparency and accountability.

"There is no point in letting concessionaires hike their project prices and at the end of the day, all they deliver are cracked bridges or un-usable ring roads and highways.

"If that happens, no amount of subsidies saved are going to do the job of easing the problems of traffic congestion and the frustrations of motorists."

Effective yesterday, the price of diesel in Peninsular Malaysia increased by 23 percent to RM1.58 per litre while petrol now cost 19 percent more at RM 1.92 per litre.