PUTRAJAYA: In a move that caught many unawares, the government upped fuel prices by the highest margins to date with immediate effect.
However, there is no change to the prices for natural gas for vehicles (NGV) and liquefied petroleum gas (LPG).
To help alleviate the pain from the price hike, the government will give annual cash rebate of RM625 to those who own cars of 2,000 cc and below, and pick-up trucks and jeeps of 2,500 cc and below. For owners of motorcycles of 250cc and below, the rebate is RM150 a year.
The cash rebate will cover cars and motorcycles for which the road tax is valid from April 1, 2008 to March 31, 2009.
In a late afternoon press conference to reveal the cabinet's decision on a new subsidy management plan, Prime Minister Datuk Seri Abdullah Ahmad Badawi also announced a new tariff structure for electricity supply in Peninsular Malaysia, which will take effect from July 1.
The new price of premium leaded petrol (ULG 97) is RM2.70 a litre, up 78 sen, beginning midnight Thursday, and for diesel, it is up by RM1 a litre to RM2.58.
The 40% increase for the ULG 97 petrol is still below the anticipated RM4 a litre price projected earlier and among the cheapest in Asia.
The prime minister said the cash rebate would be given in the form of money order at post offices nationwide beginning July 1, 2008.
Last night, those who heard the news through the grapevine began converging at petrol stations nationwide to fill up their tanks, causing congestion.
The price increases took most by surprise as there were earlier reports that fuel prices would go up only in August.
Asked whether he was concerned that these measures would be unpopular, Abdullah said: "We are not looking for popularity. This is not an attempt to be popular. We are serious about this. We can't satisfy everybody."
For the government, these measures as a whole will save the administration RM13.7 billion this year.
On the new electricity tariff, Abdullah said 59% of households in Peninsular Malaysia will not experience any increase in their monthly bill if they maintain their consumption pattern. Those who use above 400kwh a month will pay much more.
Abdullah said this is an opportunity for the people to change their lifestyle and start practising conservation.
The increase in prices announced today is the highest ever.
On Feb 28, 2006, the prices of petrol and diesel went up by 30 sen, with petrol costing RM1.92 per litre and diesel RM1.58 per litre.
The government's move to float the fuel price in accordance with the global market price however still makes Malaysia one of the countries with low prices for fuel in this region.
The new prices of petrol and diesel are far lower than the RM5.20 and RM4.22 for the fuels, respectively, in Singapore which has floated the prices as well.
The Sun
by Llew-Ann Phang
05/06/08
PEOPLE'S POWER
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