GEORGE TOWN, June 12 — The Consumers’ Association of Penang (CAP) is asking the government to continue with the targeted fuel subsidies and there is no need to make a "U-turn” due to pressure from stakeholders and political groups.

Its president Mohideen Abdul Kader said government leaders must act decisively in implementing policies that are considered unpopular but in the long term will make the country’s economy more resilient to provide benefits to the people and the country.

"Starting with targeted subsidy for diesel fuel is a right step. Subsidy should be for those who need it and not for everyone regardless of their economic status.

"By implementing this rationalisation policy, the government will have RM4 billion (whereas an economist estimated RM8 billion), which can be used for economic development and social welfare,” he said in a statement today.

Accordingly, he said the implementation of the policy needs to be closely monitored to ensure there is no leakage and distortion while the subsidy is given to targeted individuals, groups and businesses.

Mohideen also requested that any weaknesses in the implementation be immediately overcome and corrected apart from holding a special desk in the relevant ministry to monitor the implementation and also deal with problems and complaints from the affected parties.

He said the Ministry of Domestic Trade and Cost of Living (KPDN) also needs to monitor the price of goods and services sold to the public to avoid profiteering by unscrupulous traders who take advantage of the abolition of diesel subsidies.

He explained that based on the experience gained from the implementation of the elimination of diesel subsidies, the next step is the rationalisation of petrol subsidies which will result in greater savings for the government with vulnerable groups being given financial assistance.

"In the 2024 budget, fuel subsidies including diesel amount to RM60 billion per year, which is 1.5 times the amount allocated for healthcare, at around RM40 billion and a modern hospital with 1,000 beds costs between RM1.3 to RM1.4 billion.

"Imagine what we can do with the savings from the abolition of this subsidy, which means more hospitals equipped with modern equipment and much better healthcare,” he said.

On Sunday, Finance Minister II Datuk Seri Amir Hamzah Azizan announced that starting June 10, the price of diesel at all Peninsula retail stations is set at RM3.35 per litre which is the market price without subsidy based on the average of May 2024 according to the Automatic Pricing Mechanism. — Bernama