Hanky-panky in sub­si­dies

The Sun (Malaysia) - - SPEAK UP -

AFEW years ago, a petrol sta­tion owner on the out­skirts of Kuala Lumpur was or­der­ing a tanker of diesel a day. That was about 38,000 litres. It should have prompted the rais­ing of a red flag, but the petroleum com­pany ful­filled the or­ders.

It wasn’t un­til a raid car­ried out by the then Do­mes­tic Trade and Con­sumer Af­fairs Min­istry that dis­cov­ered most of the diesel ended up in fac­to­ries and used for com­mer­cial op­er­a­tions.

The diesel sub­sidy was only for do­mes­tic use and when the sup­plies and sales were tal­lied, an es­ti­mated over two mil­lion litres had ended up in the wrong hands over a nine-month pe­riod.

Sub­se­quently, sub­sidised diesel was seized by the tanker loads and it was un­known if the per­pe­tra­tors were ei­ther ap­pre­hended or pros­e­cuted.

To­day, the sub­sidy on cook­ing oil has been taken away, leav­ing con­sumers to foot the en­tire cost – if they buy it in a 5kg pack­ag­ing. But be­fore that, one star­tling fact: Lo­cal man­u­fac­tur­ers pro­duce 85,000 tonnes of cook­ing oil, which is sub­sidised by the gov­ern­ment. But the do­mes­tic con­sump­tion is only 40,000 tonnes.

So, where does the other 45,000 tonnes go? They end up across the bor­der in the North, which means the gov­ern­ment is spend­ing RM450 mil­lion an­nu­ally in sub­si­dis­ing con­sumers in two coun­tries.

This begs the ques­tion: What is hap­pen­ing at our bor­der check­points? The au­thor­i­ties are quick to call for a me­dia con­fer­ence when they seize small quan­ti­ties of rice and other goods. But how does 45,000 tonnes or about nine mil­lion 5kg­bot­tles cross the bor­der?

Of­ten, we are told about a por­ous bor­der, which has al­lowed human traf­fick­ing and smug­gling. But never, in any­one’s wildest imag­i­na­tion, would 4.5 mil­lion peo­ple be walk­ing across the bor­der with 5kg of oil in each hand! On Fri­day, Do­mes­tic Trade, Co­op­er­a­tives and Con­sumerism Min­is­ter Datuk Seri Hamzah Zain­udin an­nounced the re­moval of sub­si­dies for the 5kg pack­ag­ing, which the gov­ern­ment en­vis­aged would be no longer prof­itable to smug­gle out of the coun­try.

How­ever, the cook­ing oil sub­sidy will be main­tained only for oil packed in 1kg poly­thene bags, which is sup­posed to be a good move in pro­vid­ing tar­geted sub­si­dies to the needy.

The min­istry may feel that it has made it more dif­fi­cult for smug­glers to profit from gov­ern­ment sub­si­dies and sav­ing the gov­ern­ment mil­lions. But as they say, where there’s a will, there’s a way. What is go­ing to pre­vent smug­gling syn­di­cates and their in­ge­nu­ity and con­nivance with other au­thor­i­ties to smug­gle th­ese poly­thene bags?

Talk­ing about sub­si­dies, I was wait­ing for my ap­point­ment with the doc­tor last week when I no­ticed a lorry de­liv­er­ing Liq­ue­fied Petroleum Gas (LPG) or, sim­ply put, cook­ing gas to a nearby restau­rant. I counted 38 cylin­ders of 12kg be­ing de­liv­ered.

Of course, cook­ing gas too is sub­sidised. A 12kg cylin­der for do­mes­tic use costs RM26.60 but a 50kg cylin­der for in­dus­trial use costs RM178.

My ques­tion is: Should restau­rants en­joy the perks of be­ing able to use sub­sidised cook­ing gas for their busi­ness? If sub­sidy is meant for the in­di­vid­ual, why should bod­ies cor­po­rate and com­mer­cial ven­tures ben­e­fit?

Herein lies the prob­lem of in­tegrity or rather the lack of it in var­i­ous sec­tors of the gov­ern­ment. From pro­cure­ment of goods and ser­vices to dis­burse­ment of sub­si­dies, there has been han­ky­panky go­ing on. I am not pick­ing this out of thin air. The num­ber of cases on th­ese is­sues re­ported in the me­dia at­test to this as­ser­tion.

Here’s some food for thought: If the gov­ern­ment was aware that lo­cal con­sump­tion was only 40,000 tonnes, shouldn’t its an­ten­nas have gone up when it was sub­si­dis­ing for 85,000 tonnes? Shouldn’t some­one have asked: “Where the hell is the ex­tra go­ing to?” The whole sup­ply chain can be eas­ily mon­i­tored to pre­vent any abuse. Shouldn’t the man­u­fac­tur­ers be asked to pro­vide the names of whole­salers and the quan­tity they are sup­ply­ing? And in turn, shouldn’t the whole­salers have a list of whom they sup­ply to? Shouldn’t re­tail­ers be asked to pro­vide their sales doc­u­ments in­clud­ing in­voices and re­ceipts?

If a small kedai runcit is buy­ing cook­ing oil by the tonnes ev­ery month when it has just a small clien­tele in the ru­ral ar­eas, shouldn’t the alarm bells be ring­ing? But some peo­ple in author­ity pre­tend to be deaf – and dumb too! But then again, there’s this Malaysian malaise – tutup satu mata!

R. Nadeswaran has no qualms if sub­si­dies are given to the right peo­ple but he can­not stom­ach the ir­reg­u­lar­i­ties and money-mak­ing schemes at­tached to them. Com­ments: cit­i­zen-nades@the­sundaily.com

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