Country facing serious subsidised diesel leakages — Finance Minister II
PUTRAJAYA: The country is facing a serious problem with subsidised diesel leakages, with a possibility of ineligible parties still enjoying the subsidy, said Finance Minister II Datuk Seri Amir Hamzah Azizan.
Citing the example of subsidised diesel usage in the country, he said it was around 6.1 billion litres before the Covid19 pandemic, and now it has reached 10.8 billion litres.
“That is a 70 per cent increase... so where did the subsidy go? For now, we feel that there is a high possibility that the subsidy has shifted to sectors that are not eligible for it.
“When you buy diesel from a petrol station, you will pay RM2.15 per litre but if you have to pay the commercial rate, if you’re in a company and not eligible for diesel subsidy, you have to pay around RM3.48 per liter... so the difference is significant,” he said at the monthly gathering of the Ministry of Domestic Trade and Cost of Living (KPDN) here yesterday.
Also present was Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali. On the possibility of the subsidy not ending up with its intended target, he said this results in a greater financial burden on the country’s management.
“We need to stop this mismanagement. Our money is being paid to companies that should not receive subsidies. It should go to the people... to build better schools, clinics and other essential infrastructure for the people.
“We need to deal with the loopholes in terms of this leakage. Looking at the amount of diesel subsidies given last year, it was about RM20 billion. So if we can cut it in half, Alhamdulillah,” he said. He said the federal government would strive to generate more revenue, reduce mismanagement and channel funds to channels that prioritise the interests of the people and the country.
Meanwhile, Amir Hamzah also said that Malaysia has the opportunity to emerge from economic constraints, although it will take some time, while emphasising the need for continuous efforts to achieve this goal.
“That is why, from the government’s perspective, including through the Ministry of Investment, Trade and Industry, we have made efforts to attract investors to Malaysia.
“Alhamdulillah, last year we saw approved investments at a high level, never before achieved, amounting to RM329.5 billion,” he explained.
He said the government is now also focusing on expanding revenue, through the sales and service tax which was raised to eight per cent effective March 1, compared to six per cent previously.
Earlier, Armizan said KPDN would ensure that the ministry’s existing allocations are spent wisely without any leakages.
“Every sen must be spent prudently to achieve goals and, consequently, have a significant impact on our people,” he said.