IS THIS HOW YOU REPAY VOTERS, UMNO-BN? Nurul, Jui Meng slam fuel price hike

KUALA LUMPUR - Opposition leaders slammed Prime Minister Najib Razak's shock decision to raise petrol and diesel prices by a significant 20 sen per litre, warning that this would be the start of a slew of measures aimed to pass on the costs of a ballooning fiscal deficit to the man-in-street.

The Opposition has long been urging Najib, who is also the Finance Minister, to trim the huge billion-ringgit subsidies awarded to firms owned by cronies of top government leaders rather than to "punish" the man on the street with price hikes. An often-used example is RM19 billion subsidy granted to the 'pampered' independent power producers in the country.

"The worst is yet to come. The deficit that BN has incurred for 16 years will be the rakyat's (people's) burden to pay while the BN under the guise of the Prime Minister's Office enjoys almost half a billion ringgit for a makeover exercise," PKR MP for Lembah Pantai Nurul Izzah told Malaysia Chronicle.

"It's a pass-down to consumer mechanism whilst the Umno-BN rich continue to misgovern as per sual Wastages, leakages, expect more from the upcoming Auditor-General's report."

Price of succumbing to racial and religious bigotry

While not totally unexpected, Najib's decision to hike fuel prices is bound to disappoint and deeply anger Malaysian citizens, the majority of whom already feel the pinch of runaway property prices and costs of living.

Opposition Leader Anwar Ibrahim, whose Pakatan Rakyat coalition had promised to reduce fuel prices, had warned of such a "back-stabbing" move by the Najib administration prior to the May 5 general election.

There are  now also deep concerns that Najib, who is also the Finance Minister, will next introduce GST or Goods and Services Tax. He is due to present the national Budget for 2014 next month.

"We are living in a flawed society and ruled by a flawed government. I would say the petrol price hike is the price that those who voted for the Umno-BN have to pay. Of course, those who voted for the Pakatan will also be affected and this is grossly unfair," PKR vice president Chua Jui Meng told Malaysia Chronicle.

"This is also the price to pay for succumbing to race politics, the price to pay for religious bigotry. When you vote in a lame-duck government that is inefficient and corrupt because you are not able to resist racial and religious politicking, this is the penalty the entire country has to suffer"

Forcing the ordinary folk to go to the Ah Longs

Jui Meng also warned that such "irresponsible" policy would force the ordinary folk to encumber themselves with more debt.

"Just days ago in Johor, when I was giving a speech, I asked, has the price of cars gone down, has the price of electricity and water been reduced, how about food and transportation, are these cheaper now? Can you buy a house, is property more affordable now"" said Jui Meng.

"Household debt debt which is now at 83% of gross domestic product will shoot up to 100% of GDP because the petrol price hike has an inflationary effect. Najib and BN are forcing the people to borrow more money, to go to the Ah Longs because they can't make ends meet each moth. How much can BRIM (government cash-aid) help? I dare the government to implement GST next."

BR1M will reduce the pain?

Calling the fuel rice hike "an act to strengthen the economy", the 60-year-old Najib had rationalized the hike by saying that if the nation's economy was affected, it would bring adverse effects onto the people.

He pointed to the situation in some foreign countries which he alleged became badly affected when their governments failed to manage the economy properly.

Najib also promised to reduce the fiscal deficit to around 3% of gross domestic product by 2015 and to balance the budget by 2020.

"We must understand this is not a question of politics, but about the country's future, if the economy is affected it will bring about adverse effects on the rakyat," Najib told a press conference on Monday.

"The subsidy rationalisation will be carried out in many stages. The first is that the price of RON95 and diesel will be increased by 20 sen per litre from 12.01am Tuesday," he added.

The new prices for RON95 will be RM2.10 per litre and RM2.00 for diesel.

According to Najib, the low-income earners will not be affected as  the quantum for the 1Malaysia People's Aid (BR1M) will be increased in the Budget 2014. He also promised a comprehensive "social safety net".

"The moderation in the current account of the balance of payments (BOP), coupled with continued fiscal deficits pose medium-term risks to the economy," said Najib.

"Currently, our subsidy system benefits everyone, including the higher income group and foreigners. Thus, we need to move to a more targeted subsidy system that caters to vulnerable groups."

Malaysia Chronicle