Ong: 'Surprise announcement' on petrol subsidies inviting backlash

Former deputy minister Ong Kian Ming has questioned Economy Minister Rafizi Ramli’s statement that the government will replicate its strategy and not give the public advance notice on any decision to remove blanket subsidies for RON95 petrol.

He told Malaysiakini that the government’s move to “keep its cards close to its chest the same way it surprised everyone with the diesel subsidy rationalisation programme” was likely to be ill-received and invite a backlash.

“Firstly, the diesel subsidy rationalisation that took place in June was not a ‘surprise’ in that it had already been announced by the prime minister in the 2023 budget.

“Secondly, even though the Finance Ministry did prepare the ground for the diesel subsidy rationalisation in the announcement of the Budi programmes for the groups targeted to receive diesel subsidy assistance, the sudden manner in which the diesel price increase was announced was not well received by the affected groups.

“This includes some who were eligible for targeted assistance but had not yet applied or didn’t know they could apply, especially those in the logistics sector,” said Ong, who was deputy international trade and industry minister from 2018 to 2020.

“Given that the backlash against how the diesel subsidy rationalisation was carried out, the expected public backlash against a ‘surprise’ petrol subsidy rationalisation policy would be much greater.”

He cited as an example that questions persist over why the Padu database wasn’t used for the targeted diesel subsidy programme.

“To date, we have not had any public announcement as to how the Padu database would be used for the targeted petrol subsidy programme.

“Taking this into account, it is not surprising that Rafizi’s specific comments about a ‘surprise’ petrol subsidy rationalisation programme, if it is going to be implemented this year, did not receive a positive response from many,” he added.

Mixed messaging

Ong also questioned the mixed messaging from the coalition government, saying that Anwar himself had to give a clarification remark in a press conference in response to Rafizi’s ‘surprise’ comment, during which the prime minister said nothing on the petrol subsidy rationalisation programme had been decided yet.

“This seeming lack of alignment and coordination within the cabinet, and especially between the PM and the economy minister would not give the necessary confidence to observers, including those in monitoring the financial and the currency markets, that the Malaysian government has a systematic and well-thought-out plan to carry out the petrol subsidy rationalisation programme,” he said.

At present, the weekly Automatic Pricing Mechanism for petroleum products is set at RM2.05 per litre for RON95, RM3.47 per litre for RON97, and RM3.35 per litre for diesel in Peninsular Malaysia.

Subsidised diesel in Sabah and Sarawak remains at RM2.15 per litre.

The government has cited hoarding by unscrupulous parties and unfair distribution to defend its move to remove blanket diesel subsidies.

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