The much-awaited RM1.99 per litre for RON95 petrol is finally here. Beginning September 30, Malaysians will be able to purchase up to 300 litres a month at a discounted rate. For most of us, that is welcome news.
The response, however, has been mixed. Nobody is complaining about cheaper fuel, but questions linger about fairness—especially the fact that the rich, who often own multiple cars, benefit just as much if not more than the poor.
Rafizi’s Concerns
Former economy minister Rafizi Ramli argues that the implementation does not truly amount to subsidy targeting. His point is simple: wealthy households have more cars and drivers, and therefore capture a disproportionate share of the subsidy.
“In my view, it is not (fair) because wealthier households tend to have more vehicles and each adult in the household is likely to have both a licence and their own car.
“The total subsidies going to these affluent households are much larger than those received by less well-off households, such as those in the bottom 40 (B40) and middle 40 (M40) income groups,” he said
According to Rafizi, the imbalance will cause M40 families in urban areas with two vehicles may find themselves squeezed once their fuel usage exceeds the 300-litre cap. For the T20, the hit is minor, while rural households—who arguably should benefit the most due to their reliance on private vehicles—gain only modest relief.
The Larger Irony
Rafizi’s criticism touches on a deeper irony. The government spent RM85 million developing the PADU database precisely to enable targeted subsidies. Yet when the moment came, Putrajaya fell back on a blanket approach.
This is the essence of Malaysia’s long-standing problem: we know what reform looks like, but when push comes to shove, politics trumps policy. Fuel prices are simply too sensitive for any administration to risk alienating voters. Thus, the top 20 percent of households continue to enjoy 40–50 percent of total fuel subsidies—exactly the distortion targeted subsidies were supposed to fix.
Amir’s Defense
Finance Minister II Amir Hamzah Azizan has defended the move, saying that even this imperfect system delivers meaningful savings—RM2.5 to RM4 billion a year, down from the initial RM8 billion projection.
“Is RM2.5 billion small or big? Every ringgit saved will be used in other ways to benefit the people,” Amir argued. Some of those savings, he noted, will be channelled into direct assistance programs such as Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (Sara).
He also made a point worth considering: if we wait for a perfect system, nothing will ever get done. Political will is often paralysed by the pursuit of flawlessness.
A Step, Not the Destination
So where does that leave us? The RM1.99 RON95 subsidy is not the final solution, but it is a start. It creates immediate breathing space for households grappling with high living costs. More importantly, it signals that subsidy rationalisation is not just a slogan—it can be implemented.
But Malaysia cannot stop here. Blanket subsidies will continue to drain public coffers and reward the rich disproportionately. If the government is serious about fairness, it must eventually take bolder steps: reviving targeted subsidies with political courage, plugging leakages in the system, and ensuring that savings are channelled to those who need them most.
Personally, I think this is still a positive move, even if it is not a perfect one. It is at least a step in the direction of subsidy reform, tilted toward the working class. Could it have been done better? Certainly. But sometimes, doing something now is better than waiting endlessly for the ideal solution that may never arrive.
As the legendary American General George S. Patton once said: “A good plan, violently executed now, is better than a perfect plan executed next week.” The new RON95 subsidy may not be flawless, but it is still a good plan.
Also, as Samuel Johnson once quipped, this petrol subsidy is to me, like a “dog walking on two legs.” If i were to judge it objectively, i would say it looks clumsy and not being done very well. But the fact that for the longest time, I didn't think it that it was going to materialise, i am left pleasantly surprise, to see it done at all.
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