BUDI95: Inefficient To Set Tiered Pricing After Exhausting Quota -- Amir Hamzah

KUALA LUMPUR, Dec 11 (Bernama) -- Setting a tiered price for RON95 at RM2.10 or RM2.30 under the BUDI MADANI RON95 (BUDI95) programme after the 300-litre quota has been fully used will retain elements of inefficiency.

Finance Minister II Datuk Seri Amir Hamzah Azizan said the government views such a proposal will raise the risk of leakages and will not strengthen the government's fiscal position.

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“The government will continue to closely monitor usage patterns and trends, and re-evaluate the (BUDI95) limit from time to time.

“This is to ensure that the targeted RON95 subsidy policy is continuously refined and strengthened for the benefit of the people and the nation’s fiscal sustainability,” he said at the Dewan Negara's oral question-and-answer session today.

He was responding to Senator Datuk Abdul Halim Suleiman's question about the rationale to implement BUDI95 at RM1.99 for the first 300 litres and a floating price of RM2.60 for usage exceeding 300 litres, versus setting tiered prices such as RM2.10 or RM2.30.

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Amir Hamzah said since BUDI95 was implemented, the average petrol consumption for private users was recorded at only 98 litres per month, which is 33 per cent of the set monthly allocated limit of 300 litres.

It would be difficult to change limits at the individual level because 14 million people are under the BUDI95 programme, he said.

“If I have to set limits like this person 301 litres, that person 350 litres — the Finance Ministry's work will never end,” he said.

He added that the government will look at opportunities to improve and reconsider proposals submitted after there is sufficient data, a year after BUDI95 has been implemented.

-- BERNAMA