MELAKA: The government is prepared to absorb an increase in fuel subsidy costs, which could reach RM45 billion annually amid a surge in global crude oil prices, rather than pass the burden on to the people through higher fuel prices.
Prime Minister Anwar Ibrahim said the government remains committed to maintaining the price of RON95 petrol at RM1.99 per litre despite international crude oil prices climbing to between US$120 and US$130 a barrel.
He said this was to shield the public, particularly low and middle-income groups, from the impact of rising global fuel prices and the resulting pressure on household expenses.
“If oil prices continue to surge, the cost borne by the government could reach between RM42 billion and RM45 billion a year. If we raise fuel prices in line with market rates, people would have to pay an additional RM2 or RM3, or maybe RM5 a day.
“Imagine those who have to send their children to school and go to work themselves. That could mean an extra RM10 a day.
"It is better for the government to bear the burden than to burden the people,” he said at the Sentuhan Kasih Madani programme and launch of the National Cost of Living Action Plan 2030 at the Hang Jebat Sports Complex in Krubong here.
Also present were domestic trade and cost of living minister Armizan Mohd Ali and his deputy, Fuziah Salleh.
Anwar said global crude oil prices have nearly doubled from around US$70 a barrel previously, putting many countries under mounting cost-of-living pressures.
However, he said the government chose to continue absorbing a substantial portion of fuel subsidy costs to prevent consumers from having to face steep price increases.
He also rejected the view that generous subsidies made the people overly dependent on government assistance, saying policies must take into account the realities faced by low-income households.
Anwar said the government would continue to balance efforts to drive economic growth with its responsibility to ensure that national progress translated into a better standard of living and greater wellbeing for the people.