17 April, 2012

Petrol Subsidy


Recently the price of Crude Oil rose as a result of political instability in the Middle East. With that in mind the government had to decide swiftly on whether to allow the price to rise following the market rate like most of our neighbouring countries, or to subsidise the RON 95, maintaining it at the present rate of RM 1.90 per litre.

I cling to the principle that the Rakyat’s interest always takes priority in the government’s decision making process. Transportation costs make up a considerable proportion of the Rakyat’s daily expenses, particularly for the urbanites. Therefore the onus is on us, the Government to slow down and manage the ever escalating fuel cost, without jeopardising other budgeted expenditures on development.

To maintain the RON 95 at its current rate, the government increased petrol subsidy by almost 10%. On top of the tabled supplementary budget proposed by the government, the government will have to work harder to increase both domestic and foreign investment through the Economic Transformation Programme, in order to balance off the expenditure in long run, as well as to enlarge the revenue base of the Government.

At the same time, the world economy is experiencing recession, mainly attributed to the Euro zone crisis and the USA. It is my incumbent duty to mitigate the impact of such global downturn on Malaysians, as well as to maintain persistent economic growth at the same time. The Government always accords paramount consideration when it comes to subsidy policies on RON 95 petrol, because it affects the Rakyat’s daily expenses.

Inevitably, the long term solution to this problem of escalating petrol price, is to reduce dependency on petrol. The Government is working hard on improving the public transport system to provide a better public transport alternative to private vehicle users. To date, 38 new sets of EMUs six-carriage commuter trains have been purchased under the Urban Public Transport NKRA to improve the KTM commuter services. The 2-coach Kelana Jaya LRT is now supplemented with new fleets of 4-coach multiple units, and rail track extensions are also on the process. Long-distance travellers can also make use of the new double tracked ETS train services which now runs from Seremban to Ipoh, and to Penang and Perlis in the near future.

In conclusion, the government must work hand in hand with the Rakyat to properly manage the issue of petrol dependency. While the government endeavours to ensure affordable fuel price and improve the public transportation, we also seek for your support and understanding. For that I thank you.

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