KUALA LUMPUR: Targeted subsidy measures do not compromise the interests of the majority, assured Datuk Seri Anwar Ibrahim.
The Prime Minister said each targeted subsidy initiative aims to correct the imbalances of blanket subsidy practices that benefit the ultra-rich group and foreign nationals.
"The undeniable fact is that foreign nationals and the top 15% group of ultra-rich consumers enjoy 40% of the RM8bil RON95 petrol subsidy.
"It should be reminded that the RM8bil fund would be better utilised for improving education, healthcare, and public transportation facilities," he said while tabling Budget 2025 in the Dewan Rakyat on Friday (Oct 18).
Anwar who is also Finance Minister said that the government is committed to maintaining subsidies for the majority of the people, as demonstrated by the targeted electricity subsidy, which leaves 85% of the population unaffected.
"To avoid confusion, I would like to once again stress that the government will continue to bear the subsidy for 85% of the people estimated at RM12bil," he said.
Besides that, Anwar said that the government plans to implement the targeted subsidy measure for RON95 petrol by mid-2025, adding that the savings from this move will be used for the welfare of a majority of the people.
"Subsidies, in principle, like donations, should not be enjoyed by the ultra-rich group. For too long, we have been providing blanket subsidies for fuel, electricity, water, education and healthcare services, and even essential items like chicken."
"Such an approach is certainly unreasonable when the country is burdened with debt and has a low revenue base," he said.
On education subsidies, Anwar said if they are gradually reduced for those in the top 15% income group, the funds gained could be used to improve the infrastructure of fully residential schools (SBP) and public institutions of higher learning (IPTA), benefiting all students.
Anwar noted that the original goal of establishing SBP was to help outstanding students from disadvantaged and rural backgrounds access the best education, but based on recent figures, 30% of the students come from high-income families.
"Subsidies for each SBP student reach RM15,000 per year... similarly, at the higher education level. For example, the average tuition fee paid by undergraduate pharmacy students is RM3,000, while the total cost of education amounts to RM30,000, and these subsidies are given without considering the family's income," he said.
According to the Prime Minister, the targeted subsidy initiative will also involve public health, as high-income groups should contribute to better healthcare services in government hospitals.
He said the savings could be used to fund medical devices for poor patients and upgrade hospital and public clinic equipment. - Bernama
