Tuesday, June 3, 2008

Get ready to pay more

Let's brace ourselves for the inevitable. Newspaper editors have been invited to at least two briefings tomorrow on the new fuel subsidy scheme ahead of the Cabinet meeting. The Prime Minister is expected to announce the details of how the new subsidy scheme would work by noon. Hints have been given by Domestic Trade and Industry Minister Datuk Shahrir Samad but no details have been leaked. In short, it's very much a guessing game at this point. The signs are already there for us to see - the cost of subsidies could cause the country's deficit to shoot up to between 8% and 10% of its GDP. That would work out to about RM60bil, given that the current GDP is about RM650mil, according to visiting Prof Danny Quah of the London School of Economics recently. Fuel makes up 79% of the country's total subsidy spending in 2007 and with petrol prices rising across the globe, Quah, a Penangite, has warned that the tipping point has been reached, The Edge quoted him as saying. In short, if we don't do something about the subsidy scheme, we will pay a heavy price in the long run. We will not be able to pay for development projects such as schools and hospitals. For ordinary Malaysians, we can expect a higher cost of living. It's going to be more than just a pinch this time. As much as we understand the need to rise petrol and diesel prices, even from August, we like to see less wastage from the government. As much as appreciate the fact that Malaysians pay the least in the region for their fuel, we cannot deny that millions of ringgit have gone to waste on projects that makes little sense and sens. It will earn the government a lot of goodwill and understanding if we take a serious look at projects that burn taxpayers' money because they are overpriced or just not priority.

10 comments:

Eric Chen said...

Please don't forget that all Malaysian have been paying exorbitant tax in purchasing cars throughout the years and imagine the revenue the goverment have collected all this times.Its time the govt to take some action in favour of all the taxpayers and sheltering the rising cost of fuel is a small matters compare to the billions of tax dollars collected.

Anonymous said...

What is the tipping point and what is the subsidies??? This is a hoax story to hoodwink the general public on the believe that there are the purported subsidies. What is the nett producer & nett exporter of crude oil talking??? Look at Brunei & Saudi Arabia, both are nett producers & nett exporters of crude oil, there are no changes in the prices at their pumps for both petrol and diesel despite the whopping Crude Oil prices now reaching US$130/- per barrel, they are both enjoying boom and boost to their State Coffers with the greatest windfall of all times with great foreign reserves and boost to their economy so why are we seeing the reverse in Malaysia??? There is obviously mismanagement of the funds from the power that be. Where are the windfall profits for Petronas gone to from the nett exports ??? A royal commission should be formed to investigate where have all the profits/funds earned from the exports had gone to???

meiyen said...

I am all for raising the price of gas. Too many cars and too much gas emissions, adds to congestions and pollutants in the air. Not good for the health of the people.

It's time to do away with big projects that benefit no one except to make a big show to the rest of the world.

Time to start making life better for the poor and middle class. How about making their environment better, how about beautifying their surroundings instead of beautifying only places for tourist to visit and see? Do these Malaysians have to visit tourist spots to see how beautiful this country can be and what living and feeling good is like?

Ah Beng Crosby said...

Can the government guarantee whatever it saves on the subsidies will be channelled to the rakyat thru proper development minus the wastages? Or with the saving comes the opportunity to rob the coffers more aggresively for the select few?

I don't thrust the government with our money because it has shown it can't manage it well. Look at the government department, many of them have purchased their own fancy SUVs when there is hardly any need for it despite being petrol guzzler.

Samuel Goh Kim Eng said...

When there's the compulsory need to pay more
Will the ordinary folks in return get more?
Will wrong choices of projects become a point that's sore
When outstanding problem are still not solved right at the core?

(C) Samuel Goh Kim Eng - 040608
http://MotivationInMotion.blogspot.com
Wed. 4th June 2008.

Anonymous said...

The argurements are true but example is 500 rinngit is distributed to all the poor every 6 months then removing fuel subsidies is nothing. Good transportation will come as pressure and market forces drive these needs. Petrol should be taxed like Singapore and priced at 5 ringgit a liter. Malaysia is going to become a net importer soon. BN must be defeated and the wealth of BN cronies should be further distributed to the poor.

Bunnies said...

Hmmm.. sounds scary... does that mean I will drop from a higher middle income to a lower income family unit? Does that mean I have to give up the many small luxuries that I reward myself with? If so, than my life isnt improving but regressing!

Than, why am I paying tax for? To feed some hopeless and useless who cannot give me a better financial environment? What is worse is that I see these hopeless and useless people and their families enjoying the same standard of living like usual, shopping and eating at their usual posh outlets and cafes?! Taking the same many overseas trips...How could this be? Something is not very right here...

Jed Yoong said...

Is he a Hokkien Penangite? Can he speak Cantonese or Mandarin? So how does the fact that he is Penangite add weight to his comments? Koh Tsu Koon is ALSO PENANGITE!!!

zackdanial said...

The only solution is to use Petronas profit to bring down oil price for M'sian or else the other option is Snap Election and the winner of Snap Election (i hope will be Pakatan Rakyat ) bring down the oil price as promised is March 2008 election .

Anonymous said...

Remove the cancer, throw out the rotten tyranny

It is the right time that this grossly corrupt and incompetent tyrant government that remove the fuel subsidies & increase the electricity tariffs should also be removed by whatever means necessary to accomplish this as well. Datuk Anwar Ibrahim & Pakatan Rakyat, it is your call now and as all the people of Malaysia are firmly behind you. Cannot imagine that a nett producer & nett exporter of Crude Oil has to do this, look at Brunei, Saudi Arabia and many other crude oil nett exporters, there are no increases of prices of Petrol & Diesel at their pumps as both & all are nett producers and nett exporters of Crude Oil and they are now enjoying a boost to their economies with a whopping windfall in oil prices of the current US$137/- per barrel that earned them huge foreign exchange reserves from their Crude Oil exports. But in Malaysia the reverse is true as there is no boost to the economy, but only sadness prevailed because the foreign exchange reserves from Crude Oil nett exports earned are poorly managed or badly mis-managed and no one knows where all the profits over the years had gone and we are saying all the 700 or more Billions earned had disappeared and there is no accountability by the tyranny power that be.