Govt could save up to RM17 billion if T20 not given fuel subsidies, says deputy minister

The Dewan Rakyat was today told that the government could save up to RM17 billion if the top 20 income group (T20) was not given petrol, diesel and liquified petroleum gas (LPG).

Deputy Finance Minister Ahmad Maslan said that in 2022, consumption of the three types of fuel by the lowest income group (B40) was only 24%, while the middle-income group's (M40) was 41% and the T20's was 35%.

"In terms of data, the total is RM50.8 billion and if multiplied by the 35% used by the T20, the value is RM17 billion.

"If the T20 are not given petrol, diesel and LPG subsidies, the amount saved is between RM15 billion and RM17 billion, so imagine how many other items we can use to assist the people in various matters in 26 ministries," he said during the question-and-answer session at Dewan Rakyat. 

He was replying to a supplementary question by Ahmad Amzad Hashim (PN-Kuala Terengganu) who asked if the government's move to use an integrated database in the targeted subsidy mechanism was effective in preventing leakage, and how those in the M40 group who drop out of the B40 group in the city benefit from the targeted subsidies.

Ahmad said the total subsidy given for diesel from 2018-2019 was RM5.8 billion to RM6.1 billion, but that this increased to RM8.4 billion due to its increased use.

Meanwhile, he said the government would continue to monitor petrol and diesel smuggling activities in an integrated manner with the relevant agencies including the customs department, the Malaysian Maritime Enforcement Agency and the police.

He said the price of RON95 in Malaysia was much cheaper at RM2.05 per litre compared to neighbouring countries such as Singapore (RM8.51 per litre), Thailand (RM5.71 per litre) and Indonesia (RM3.78 per litre).

Ahmad was replying to a supplementary question by Aminolhuda Hassan (PH-Sri Gading) on the measures taken by the government against individuals who smuggle fuel.