by AUFA MARDHIAH

THE government’s targeted diesel subsidy programme has reportedly saved approximately RM600 million per month since its implementation in June 2024.

Deputy Finance Minister Datuk Seri Amir Hamzah Azizan said the initiative, aimed at curbing smuggling and misuse of subsidised fuel, has led to a 25% reduction in diesel sales to petrol stations, translating to a daily decrease of about seven million litres. 

“Commercial diesel sales, however, have surged by nearly 50%, indicating that industries have stopped sourcing subsidised fuel from petrol stations,” he said in Parliament today.

Amir Hamzah disclosed that the government has allocated RM160 million over the past five months to support more than 140,000 individuals and 65,000 recipients in the agro-commodity sector.

This targeted approach has not only reduced fuel misuse but also helped maintain a controlled inflation rate, with the Consumer Price Index (CPI) rising by 2% in July, 1.9% in August and 1.8% in September.

With positive results from the diesel subsidy targeting, the government plans to extend the approach to RON95 fuel by mid-2025. 

“However, the eligibility criteria for households under the proposed T15 category are still under review, with income levels from the Household Income Survey by the Department of Statistics Malaysia serving as a reference,” he said.

In a further measure to protect vulnerable groups, the government has maintained diesel subsidies at RM1.88 per litre for public transport and RM1.65 per litre for fishermen. 

Land freight operators can still access subsidised diesel at RM2.15 per litre, the rate before the June 10, 2024 price adjustment, when the standard pump price for unsubsidised diesel was set at RM3.50 per litre.

Additionally, small-scale farmers, individual diesel vehicle owners and smallholders are eligible for monthly cash assistance of RM200, or RM2,400 annually, under the Budi Madani programme to alleviate the impact of rising costs.