No hidden charges in RON97 petrol and diesel pricing, says Deputy Finance Minister

KUALA LUMPUR: There are no hidden charges in the weekly retail price of RON97 petrol and diesel set by the government, says Deputy Finance Minister Lim Hui Ying.

She told the Dewan Rakyat that the weekly pricing for these fuels is determined through a managed-float mechanism.

"There are no hidden charges. In line with the implementation of targeted diesel subsidies since June 10, retail diesel prices have been determined weekly through a managed float mechanism," she said.

"We closely monitor diesel prices to ensure the rates decided by the government meet the required standards," Lim said in response to a supplementary question from Muhammad Fawwaz Mohamad Jan (Perikatan-Permatang Pauh) about allegations of hidden taxes on RON97 petrol and diesel.

On a separate matter, Lim said that geographic factors and the reliance on diesel for most modes of transportation were among the top reasons why targeted diesel subsidies have not yet been carried out in Sabah and Sarawak.

She said this is because a large portion of transportation for economic activities and development projects in these two regions relies on diesel.

"Additionally, the geographical conditions of these regions limit the implementation of the ‘fleet card’ mechanism, which requires more suitable infrastructure, particularly in remote areas," added Lim.

"However, we are still in the study phase to ensure that the implementation of targeted diesel subsidies may be carried out in the future, although it requires more time for research," she said.

In response to a supplementary question from Azli Yusof (Pakatan-Shah Alam), Lim acknowledged weaknesses in the current implementation of targeted diesel subsidies but did not elaborate.

She said that the situation is being monitored continuously and that the ministry is engaging with relevant stakeholders and industries to address the issues.

"It’s undeniable that when introducing something new, there will be weaknesses. We will monitor the situation continuously and are actively engaging with the relevant parties and all related industries," she said.

"If there are areas for improvement, we will definitely make changes. However, since the implementation of targeted diesel subsidies began less than six months ago, we are still in the early stages," she added.

"We will continue to monitor and improve the implementation of subsidised diesel over time," she said.

As of Oct 31, 2024, over 140,000 individual recipients of the Budi programme and 65,000 recipients under the Budi Agri-commodity programme have been approved within five months of implementation since June 2024, with total payments amounting to RM160mil.

"According to initial data, the targeted diesel subsidy programme has generated savings of around RM600mil per month," she said.

"The savings achieved through this critical measure will allow the government to allocate more resources to other key sectors that directly improve the quality of life for the people, including public infrastructure, healthcare, and education, such as roads, hospitals, and schools," she added.