Thursday 26 May 2011

Pakatan MPs say subsidy cuts timed for snap polls

May 26, 2011
KUALA LUMPUR, May 26 — Several opposition lawmakers today shrugged off the government’s decision to postpone fuel and gas subsidy cuts as a political decision timed for the coming general election.
They reminded Malaysians that the cuts were inevitable as the government had already complained of a burgeoning subsidy bill, which is expected to double from RM10.32 billion to RM20.58 billion this year.

Nik Nazmi said the general election must be ‘very near’
PKR communications director Nik Nazmi Nik Ahmad scoffed at yesterday’s Cabinet decision to postpone the cuts, saying it was “typical BN (Barisan Nasional) propaganda”.
“Elections must be very near, then. They have done this so many times. They play good cop, bad cop... first they say the government desperately needs to cut subsidies. Then, Cabinet meets and decides to relent, saying they will not impose cuts,” he told The Malaysian Insider.

He predicted that once elections are called and should BN stay in power, the government would immediately slash subsidies according to plan.
DAP leaders Nga Kor Ming and Datuk Ngeh Koo Ham agreed with Nik Nazmi, pointing out that the country was struggling under the burden of its national debt and a budget deficit.

“It is obvious that elections are near and from what they say, there is no question over their intention to increase prices of gas and petrol soon. I think it is a political decision,” said Ngeh, who is DAP deputy secretary-general.

“They (government) are facing a financial crisis and cannot continue paying for subsidies any longer,” said Nga, the DAP national assistant treasurer.

The Pakatan Rakyat (PR) leaders maintained that the administration was going about the subsidy issue in the wrong way, saying the government should instead focus on cutting its own expenditure instead of burdening the people.

Ngeh pointed out that by cutting corruption in government procurement deals, the administration could slash its expenditure by at least 40 per cent for many projects.

For example, the Beruas MP claimed that the government had spent more than RM2.4 million to build SJKC Ayer Tawar in his constituency whereas he had successfully built SM Methodist for merely RM1.3 million.
“Fact is that government projects are often at least 40 per cent or 50 per cent than the actual cost because of all the sub-contracts given to government cronies.

“Imagine, if we can slash our spending by 40 per cent for every project... so if we have RM50 billion worth of projects, we can save RM20 billion and this could be used to subsidise the poor,” he said.

Nik Nazmi urged Malaysians to stand up for themselves by staging an uprising to protest against unfair government policies.

“Through the ballot boxes, through social media, and even on the streets... through protests and demonstrations. It is time to tell the government that enough is enough.

“They must remember that they are the ones affected, especially the working class, the lower middle class, they are being squeezed. You do not even need to own a car and drive to feel the pinch — just walk into a mamak shop and order a glass of teh tarik,” he said.

Putrajaya deferred its decision to slash subsidies for RON95 petrol and liquefied gas petroleum following a Cabinet meeting yesterday but no deadline was imposed on the postponement.

Deputy Finance Minister Datuk Donald Lim however said today that Malaysia will review fuel prices if the price of oil rises to US$110-120 per barrel.

Investment research firm AmResearch recently estimated Putrajaya is now subsidising at least 90 sen per litre of RON95 versus the intended 30 sen per litre after global crude oil prices surged to US$99 per barrel from US$79 per barrel last year, matching the US$100 per barrel recorded in 2008.

Petrol subsidies will push the government’s fiscal deficit over the projected 5.4 per cent of GDP towards six per cent if RON95 is kept at the current price of RM1.90 per litre for the rest of the year, AmResearch noted.

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