PETALING JAYA: Malaysians woke up to a rude shock this morning when the prices of their usual breakfast shot up overnight as the federal government started reducing subsidies on sugar and fuel with immediate effect.
PAS in an immediate reaction to Prime Minister Najib Tun Razak’s late evening announcement of phase one of the government’s move to remove subsidies altogether, described the decision as “sneaky and insidious”.
According to PAS deputy president Mahfuz Omar, despite Parliament being in session for a month, the federal government had made no move to discuss the subsidy issue or present a working paper on the matter.
“It was a rude shock... a sneaky and insidious move to humiliate the rakyat,” he said in an apparent reference to the embarrassing decision by the government to back down on its move to legalise sports betting.
“Now, it could very well be payback time,” he added.
The Pokok Sena MP has criticised the government for making an arbitrary decision to increase prices of essentials without discussing it in Parliament.
“The government cunningly announced the increase after the end of the Parliament session... it didn’t discuss the matter with the people... so when actually will the government ever discuss removal of subidies with the people?” asked Mahfuz.
“The government did not discuss the price hike with the MPs, it did not table a working paper when it is a national concern... it rudely announced the price hikes overnight.”
Stagnating salaries
Late yesterday evening, the federal government stunned Malaysians when it suddenly announced a reduction in subsidies on prices of necessities. The new prices were effective from midnight.
Sugar is now 25 sen more per kilo (new price is RM1.70 sen per kg) while RON 95 petrol and diesel is up by 5 sen per litre (new price for RON 95 is now RM1.85 per litre and diesel is RM1.75 per litre).
Liqued petroleum gas (LPG) is also up by 10 sen. The new price is RM1.85 per kg.
The RON97 petrol will now be subjected to a managed float, where the price will be determined by the automatic pricing mechanism or market forces.
These were the lists made available by the government on its website www.pmo.gov.my and www.pemandu.gov.my.
The new prices will inevitably affect every level of income in the country as inflation continues to soar against stagnating salaries.
Mahfuz said Najib’s explanation that the price hikes were small and not a burden on the consumer is irrational.
“It just proves that the government has failed to manage the economy properly.
"How can removing subsidy not burden the rakyat? It’s just an excuse by the government to cover up their own failures.
“The government wants the rakyat to change their lifestyles…but it is not willing to change its style of managing the economy.
“The government is wasteful when it conducts direct negotiations (for its business operations) which is expensive. It could easily adopt an open tender system.
“It doesn't seem to understand that every disbursement is public money,” he told FMT today.
He said with this latest move by the government, Najib has put public interest on the backburner, thus contradicting his own 1Malaysia slogan of “people first”.
“Like I said in Parliament before... it looks good and sounds nice (slogan) but there's no real change. The government is still eating chicken and prawns while the people are stuck with lengkuas and onions…” he quipped.
Reduced subsidiary
Last night, Najib announced the unpopular move to reduce subsidies, saying it would save the government RM750 million a year.
He said the latest announcement was the first step towards rationalising subsidies in stages beginning today.
He said the government, however, would still be spending RM7.82 billion in fuel and sugar subsidies in 2010.
He added that fuel and sugar prices were still the lowest in the region.
Najib said savings from the reduced subsidies will go towards development projects, which would directly benefit the people.
On May 27, Minister in the Prime Minister’s Department Idris Jala had reportedly said that Malaysia will be bankrupt in 2019 if it continued with its subsidy schemes.
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