KUALA LUMPUR, Oct 13 — The government today announced that the temporary ceiling price imposed for chickens and eggs will be waived to allow room for the market to freely manoeuvre in ensuring uninterrupted supply.

Prime Minister Datuk Seri Anwar Ibrahim, in his Budget 2024 speech, said the present trend revealed that the supply of eggs and chicken has stabilised and the present retail price is far below the controlled ceiling price.

"Since February 2022, the government has shouldered a total of RM3.8 billion for chicken and egg subsidies.

"The main purpose for this temporary subsidy was initially aimed at controlling the sudden hike in prices and supply shortage,” Anwar said, addding that further announcements will be made by the Agriculture and Food Security Ministry within two weeks’ time.

He said even though Budget 2023 had allocated RM64 billion for subsidies, the amount needed is expected to reach around RM81 billion.

"This increase is due to the measures imposed by the government to retain prices of subsidies goods for the people even as we faced unexpected hike in prices of global commodities.

"Although subsidies goods have benefited the people in minimising their cost of living, realistically, subsidies have benefited the rich and the cheap prices have contributed to an increase in leakage and smuggling,” he said.

Separately, Anwar also announced the government’s intention to implement a gradual rationalisation of petroleum subsidies involving diesel where exemptions will be given to only a select few.

"Diesel subsidies, however, will continue to be enjoyed by selected consumers such as logistics companies while other consumers will be charged at a higher price.

"With this approach, this will prevent subsidy leakages, and at the same time, reduce the impact on daily goods for the people,” he said.

Anwar said diesel suffered from serious leakages issue where data on subsidised diesel sale shot up to 40 per cent in 2019 when the number of diesel-powered vehicles only increased less than three per cent.

"This means there is the existence of serious smuggling activities due to our cheap diesel,” he said.

Anwar said with the rationalisation of targeted subsidies set to be implemented next year, savings from the rationalisation exercise will be channelled directly to increase allocations of cash aids under the Rahmah Cash Aid initiative.