No further slash in fuel subsidies: Malaysia

June 7th, 2008 - 12:54 pm ICT by IANS  


Kuala Lumpur, June 7 (IANS) Malaysia will not turn back on its decision to reduce subsidies on fuel, but there would be no further reduction, a minister said as the government, bracing opposition protests, announced austerity measures, as elsewhere across the world, following rise in fuel prices. Prime Minister Abdullah Ahmad Badawi’s government has prepared a four-point relief package, including ‘cash back’, for needy Malaysians as public protests marked last Thursday’s fuel hike.

At a meeting with senior editors here, Badawi said the four entailed cost-saving measures by government departments and agencies, expanding the social safety net for people in the lower income bracket and underprivileged groups like single mothers and the handicapped, enlarging the list of controlled items to keep costs down, and improving public transport such as putting more buses on the roads.

The Democratic Action Party (DAP), among others, an opposition party that emerged strong in the March elections and shares power in some of the states, said it would continue with the protests.

Long-time prime minister Mahathir Mohamad, a vocal critic of the Badawi government, demanded measures that would provide relief to the poor.

The subsidy slash that was built into the price hike would not be reduced further, Domestic Trade and Consumer Affairs Minister Shahrir Abdul Samad said Friday.

“Consumers must understand that this is the first time a reduction in subsidy comes with a ‘give back’ to car owners. This means that the net increase is much less than the 78 sen rpt sen increase per litre for petrol.

“What is most important now is for the government to make sure that the give back is done smoothly, efficiently and as soon as possible,” the minister said, adding that a subsidy management system was better than a blanket subsidy.

Commenting on the street protests, he said it was only natural that certain groups would try and take advantage of the situation.

A few small demonstrations against the fuel price hike took place Friday despite warnings by Home Minister Syed Hamid Albar. Public rallies in Malaysia require police permission.

“Things like this present an opportunity to our political enemies.

This is a political reality we have to face,” Samad said.

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