RON95 price to be floated

PUTRAJAYA: The price of RON95 will float according to the market once the targeted fuel subsidy scheme kicks off in January next year. Under the scheme announced by Domestic Trade and Consumer Affairs Minister Datuk Seri Saifuddin Nasution Ismail yesterday, only recipients of the Bantuan Sara Hidup (BSH) who are based in Peninsular Malaysia are entitled.

“This fulfills Pakatan Harapan’s 14th General Election pledge which is to provide fuel subsidy only for the needy,” Saifuddin told a special press briefing at his ministry here yesterday.

Car owners who are entitled to the scheme will receive RM120 every four months; and RM48 every four months for motorcycle owners.

The recipients will get their payment via cash transferred into their bank accounts, with the first payment scheduled for April 2020.

BSH recipients who have up to two cars and two motorcycles registered with the Road Transport Department (JPJ) under their names will be eligible for the scheme.

This means that those who own three cars under their name will not be eligible.

The subsidy will only be given to BSH recipients who owned cars with 1,600cc engine and below, as well as cars that are 1,600cc and above which are at least 10 years old.

Qualified motorcycles are those that are 150cc and below, or 150cc and above if they are seven years old.

With the price of RON95 no longer controlled, Saifuddin said the government promised that it would not allow a sudden increase, should global prices shoot up.

“The government is committed to ensuring that any price increase will be a gradual one so that it will not burden the rakyat,” said Saifuddin.

He added that the ministry will also beef up enforcement to ensure that traders do not use any fuel price increase as justification to hike up the price of goods.

As only BSH recipients in Peninsular Malaysia are eligible for the subsidy scheme, the price of RON95 petrol in Sabah, Sarawak and Labuan will continue to be subsidised and fixed at RM2.08.

Saifuddin said this is because it does not cost so much for the government to subsidise RON95 in East Malaysia, adding that there are many more diesel car users there.

The targeted fuel subsidy scheme was announced during the tabling of Budget 2019 by Finance Minister Lim Guan Eng.

Based on BSH and JPJ records, about 2.9 million people are eligible for the scheme.

At present, the price of RON95 is fixed at RM2.08 while the price of the higher grade RON97 is controlled by a floating mechanism.

The system, however, has its weaknesses – as the subsidy can be enjoyed by all car owners, even those with high income.

Source: TheStar