Fuel subsidy mechanism for M40 to be decided by March

The government may have settled the RON95 fuel subsidy mechanism for the B40 group but it is still working on the disbursement method for M40 income earners.

Finance Minister Lim Guan Eng said the government aims to come up with the mechanism by March next year.

"The M40 (subsidy mechanism) will be ready by March using a card system. Let us study the matter and determine the mechanism.

"When all this is ready, we will make the announcement," he told journalists in Kuala Lumpur.

While the government has ample data on the B40 community based on the Bantuan Sara Hidup (BSH) cash aid scheme, it has not built a centralised database on the M40 demographic.

The B40 community will have the fuel subsidy payment deposited into their bank accounts every four months, similar to the BSH payments.

Lim had last week announced during the tabling of Budget 2020 in the Dewan Rakyat last week that the fuel subsidy for the non-B40 group would be disbursed with the aid of a card called "Kad 95".

He added the government expects Brent crude oil price to be around US$62 per barrel next year but may conduct a review for a possible increment in petrol subsidy if there was a drastic spike.

Under the targeted subsidy plan, qualified car owners will get a 30 sen subsidy for up to 100 litres of fuel a month while motorcyclist will get subsidy for up to 40 litres a month.

This only applies to Peninsular Malaysia while East Malaysia will continue to enjoy an unlimited subsidy.

 On a separate matter, Lim said he did not want to get into an argument with Kelantan Menteri Besar Ahmad Yakob over the terminology of the payment the federal government made to Kelantan last month.

Yesterday, Lim had said that the federal government had paid oil royalty to Kelantan last month but Ahmad disputed this, claiming the money was not oil royalty but a "goodwill payment".

"I don't want to argue over the terminology used. What was paid was paid earlier than expected by the federal government," he said.

Meanwhile, Kelantan Deputy Menteri Besar Mohd Amar Abdullah said if the payment was indeed oil royalty, it would have amounted to no less than RM1 billion.

However, he said the total payment for 2019 received was  RM28 million which he said was a "goodwill payment".

"The goodwill payments and oil royalty are separate issues. Even the Finance Ministry letter said it was a goodwill payment," he told journalists in Kota Bharu today.

-Mkini