FOMCA: Targeted fuel subsidy is good but transparency must be assured

The Federation of Malaysian Consumers Associations (FOMCA) believes that the proposal to restructure fuel subsidies is a good move, but only if transparency is assured and there is no room for abuse.

"Many countries have implemented a targeted subsidy system, and it is about time Malaysia does the same, but the implementation requires transparency on the part of consumers and suppliers," said FOMCA CEO T. Saravanan.

"Next, the system has to be carefully implemented so that only those from the low-income groups receive it.

"The other thing that will be a big issue is the paperwork and bureaucracy when it comes to claiming the subsidy.

"I hope the government will reduce the red tape and don't give people the runaround.

"The simplest and easiest way to access the assistance should be implemented," he told The New Straits Times.

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However, the FOMCA chief also cautioned the government that removing fuel subsidies would raise prices of necessities even further.

"Even if they (traders) also enjoyed the subsidy, their excuse would be that everything else has gone up, and they too have to hike their prices.

"In times of such severe inflation, this is likely to backfire," he said, adding that middle-income M40 families are feeling the pinch now.

"Putrajaya should be prepared to face the ire from the B40 and M40 groups if it plans to implement it now," he added.