The government is in the final stages of deliberating on the implementation of targeted RON95 fuel subsidies, with a decision expected from the Cabinet in the coming weeks, Economy Minister Rafizi Ramli announced today.
Speaking at the Malaysian Economic Forum, Rafizi revealed that the plan aims to ensure subsidies are allocated to deserving households, marking a shift in how financial assistance is distributed.
New Subsidy Framework Based on Net Disposable Income
The economy ministry has proposed moving away from the traditional income classifications of B40, M40, and T20. Instead, the targeted subsidy system will rely on households’ net disposable income to determine eligibility.
“We are going through the internal processes to finalize this. In a few weeks, the government will finalize the proposal made by the economy ministry,” Rafizi said.
Once the Cabinet approves the plan, the government will begin identifying eligible recipients for the subsidies. Rafizi emphasized the importance of clear communication to ensure Malaysians understand the changes.
“As soon as we get the green light, it is our duty to communicate the changes,” he said.
Leveraging the Padu Database for Implementation
Rafizi highlighted that the government would use the Padu database, which includes data on 21 million Malaysians, to administer the targeted subsidies. The database has been reopened for new registrations to ensure inclusivity and accuracy.
“Padu is the government’s most comprehensive database and will be instrumental in targeting subsidies effectively,” Rafizi added during his forum address.
Reducing Leakage and Improving Spending Efficiency
The move to targeted subsidies forms part of the government’s broader strategy to reduce financial leakage and improve the efficiency of public spending. By ensuring subsidies reach those who need them most, the government aims to make better use of its financial resources while reducing wastage.
The targeted RON95 subsidy framework reflects Putrajaya’s commitment to refining its approach to economic assistance and enhancing fiscal responsibility. Malaysians can expect further updates once the Cabinet finalises its decision.
