Proposed Fuel Subsidy Plan Officially Scrapped

We tried to dismiss the circulating rumours. We tried to believe that the government will carry out a plan beneficial to Malaysia's long-term future, and not bow to public pressure. But we were wrong. The government has officially scrapped the proposed fuel subsidy plan originally scheduled for implementation on May 1.

Don't get us wrong: the proposed plan was flawed in concept, and is sure to cause a massive headache whether in implementation or enforcement. But it was necessary; the government had to conceive a plan to reduce the money spent on fuel subsidies—in 2009, RM 3.4 billion went to subsidising petrol and RM 1.9 billion to subsidising diesel. The money should have been spent on more productive activities instead, such as, first and foremost, on improving public infrastructure.

So it was great to see the government proposing a plan that not only reduces the fuel subsidies, but takes care of the less well-to-do among us. The plan calls for the mandatory use of MyKad to differentiate Malaysians from foreigners. Naturally, foreigners would have to pay fuel prices at unsubsidised rates. Malaysians would pay fuel prices according to engine capacity and various socio-economic factors. A monthly quota of the amount of subsidised fuel each of us can pump was also discussed.

Regarding the latest decision to scrap the plan for good, the government insists that it is not because the plan is difficult to implement and enforce, but because the government listened to and respects the opinions of Malaysians—most of whom are against the plan.

Whatever the case or rationale, the fact is that, once again, the government has taken policy flip-flopping to the limit; all that manpower and man-hours spent brainstorming, discussing, drafting and announcing the plan has now gone to waste. If the plan is not hard to implement and is necessary for the long-term interest of Malaysia—and it should be considering the time and effort spent drafting it in the first place—why is the government bowing to public pressure... for the umpteenth time?