THE government’s recent proposal to use e-wallets as a means to determine the eligibility for RON95 fuel subsidies appears immature and may lead to significant operational challenges and public dissatisfaction.

Citing the practical implication of implementing e-wallet verification at petrol stations, MCA vice president Datuk Lawrence Low said requiring petrol attendants to check each motorist’s e-wallet status for subsidy eligibility is likely to result in long queues, delays and inconvenience.

“This approach is inefficient and overlooks its potential impact on petrol station operations, placing additional burdens on staff and compromising service efficiency,” he stressed.

“Moreover, a vehicle owner’s personal privacy details are now open and susceptible to falling into wrong hands or persons with sinister motives.”

Low further noted that as e-wallet adoption across the country remains limited especially among elderly populations, this leaves a substantial proportion of citizens at risk of being excluded from subsidies they may be eligible for.

Many senior citizens are either unfamiliar with or hesitant to use digital payment systems, making the E-wallet requirement particularly impractical for this vulnerable group.

“As this demographic often has the greatest need for subsidies, relying on e-wallets for eligibility is insensitive to the diverse needs of Malaysia’s population,” Low, who is also the party’s Economic and SMEs Affairs Committee Chairman remarked.

On Tuesday (Nov 5), Bernama reported Deputy Finance Minister II Datuk Seri Amir Hamzah Azizan as saying that the commercial sector, non-citizens, and illegal petrol smuggling account for approximately 40% of petrol consumption.

Responding to this, Low said targeting individual citizens rather than addressing misuse by these specific groups is both unfair and ineffective.

Instead of restricting subsidies based on individual e-wallet data, the government should consider stricter regulatory measures to prevent abuse by ineligible sectors, thus achieving substantial savings without compromising subsidies for deserving citizens.

“Besides, the concept of a T15 group as a criterion for subsidy eligibility further underscores the policy’s lack of clarity,” he stated.

“This group, as yet undefined, introduces uncertainty, particularly since the government has indicated that it will not rely solely on data from the Household Income Survey. Such ambiguity only adds to public confusion and raises doubts about the policy’s readiness.

“Given these unresolved issues, the proposed timeline for rationalising the RON95 subsidy by mid-next year is both unrealistic and premature.”

While Low applauded the government’s efforts to streamline and secure fuel subsidies, he pointed out that the current proposal to use e-wallets presents critical challenges that could undermine its effectiveness.

“Addressing the misuse of subsidies by commercial sectors and non-citizens directly rather than implementing a broad and unrefined system would yield more effective and equitable outcomes,” he added.

“For this policy to succeed, a more mature, inclusive, and carefully considered approach is essential.”

On a related matter, speaking during the Minister’s Question Time in the Dewan Rakyat on Tuesday, Amir Hamzah said the RON95 subsidy rationalisation, which will come into effect mid-2025, will not affect 85% of Malaysians and would involve tiered pricing such as that in diesel and electricity rates.

He said the RON95 rationalisation has to be done due to the huge difference in price that has led to leakages in petrol subsidies, where the subsidies are enjoyed by those who are not eligible. – Nov 7, 2024

https://focusmalaysia.my/e-wallet-eligibility-for-fuel-subsidies-a-well-intentioned-policy-that-misses-the-mark-says-mca/