Kuala lumpur: The government is taking a longer time to implement the RON95 fuel subsidy rationalisation compared to other subsidies to ensure that the implementation is carried out carefully and does not negatively affect the people.
According to BERNAMA News Agency, the Ministry of Finance (MoF) in a written reply on the Parliament website mentioned several factors for the delay, including a detailed study on the implementation approach for BUDI MADANI RON95 (BUDI95). This is crucial as RON95 petrol is widely used by consumers and constitutes a significant component of household expenditure.
Additionally, the coordination between government agencies and oil companies, extending down to petrol stations nationwide, is being given attention. System preparations and testing are also prioritized to ensure a smooth user experience, as per the ministry’s statement.
The ministry was responding to a query from Datuk Seri Dr Shahidan Kasim (PN-Arau) regarding why the MADANI government took an extended period to announce the reduction in petrol prices.
It explained that the phased approach allowed the BUDI95 programme to be refined based on insights gained from the successful implementation of the BUDI MADANI Diesel programme last year.
“This approach enables the government to improve and strengthen the targeted subsidy mechanism to be more efficient and effective, while delivering benefits to the people through the reduced subsidised RON95 price of RM1.99 per litre,” the statement noted.
Since 2023, the government has gradually implemented various subsidy retargeting measures, including subsidies for electricity, chicken and egg price flotation, targeted diesel subsidy, and electricity tariff restructuring, the MoF added.
These measures aim to sustain the national economy, reduce leakages from smuggling of subsidised goods, and ensure that subsidy benefits reach groups that are genuinely eligible.
The ministry emphasized a gradual approach to ensure that savings are achieved without burdening ordinary people. “As a result of this approach, the 2024 inflation rate was contained at 1.8 per cent compared to 2.5 per cent in 2023, while in the third quarter of 2025, the rate further declined to 1.3 per cent,” it stated.