This article first appeared in The Edge Financial Daily on March 14, 2019 - March 20, 2019

KUALA LUMPUR: The new mechanism for a targeted fuel subsidy has not been finalised so far, as the government is now devising a measure that could also include Malaysians whose primary transportation mode is the boat and villagers who buy diesel for power generators.

Deputy Domestic Trade and Consumer Affairs Minister Chong Chieng Jen said the government is also weighing on whether the subsidy should be in the form of cash or rebates.

“We have not decided on whether to give cash or rebate when they conduct the fuel purchase. All these are not finalised, we also take into consideration of a certain group of people in the rural area, especially in Sarawak, where they use boat as their primary transportation mode.

“The targeted subsidy must also take into account of those who lives in villages or long houses, as they use diesel to generate electricity through generators,” he told reporters outside the Dewan Rakyat.

Nonetheless, Chong said the date to implement the new mechanism remains at the end of second quarter, and the government will run a pilot programme before rolling it out to the whole country.

Earlier in the Dewan Rakyat, Datuk Salim Sharif (BN-Jempol) asked the domestic trade and consumer affairs ministry to state the effectiveness of the new mechanism in reducing cost of living through the targeted fuel subsidy system for RON95 petrol for rural communities located in the remote areas and far from the petrol stations.

Chong said the mechanism will take into consideration both urban and rural Malaysians, but there is no definite decision being made on the way to implement this new subsidy yet.

“The ministry of finance has opened tenders to parties to submit their proposal on implementation of the new fuel subsidy, and we are still studying the proposals that have been submitted,” he said.