It’s estimated 19.4 billion will be used to subsidize petrol, cooking oil, sugar, rice and wheat flour in 2012, but the benefit to poorest Malaysians is limited.
A big pie 75% of subsidies will go to rich and upper middle income groups with high capacity cars, foreigners living in Malaysia, neighboring countries through smuggling and Singapore and Thai driving tourists.
It’s better to distribute coupon or cash to poor people like BR1M than giving out blanket subsidies.
RM2,000 cash for those people with earning below RM 3000 per month only cost the government 8 billion. Price inflation for essential goods due to fuel subsidies cut can be well cushioned with the cash handout.
Number of BN White Elephant Project monitored : 9 75% wasted subsidy with public funds : RM 14.55 billion Total accumulated cost or losses : RM 42.288 billion or RM 42288 million