Media Statement
by Lim Guan Eng

(Petaling Jaya, Tuesday): DAP will take up the offer by Prime Minister Datuk Seri Abdullah Ahmad Badawi in his special briefing to 4,000 BN leaders in the Kuala Lumpur City Convention Centre on Sunday that the opposition can see him on the 30 cents fuel hike. Datuk Seri Abdullah had said, "The Opposition can come and see us to learn why it was necessary to impose the 30 sen increase. We have nothing to hide. We have to be transparent."

DAP hopes that the Prime Minister will show that he has nothing to hide and is transparent by meeting the DAP delegation who wants to impress on him the anger of the people at the explanations of the fuel hike. Instead the government is seen as uncaring and unsympathetic of the sufferings and extra financial burden placed on lower income groups wage earners and the poor.

The fact that BN has go on a mammoth drive to mobilize its 4.5 million members to explain the rationale for the fuel hike highlights how unjustified the increase is and the complete rejection of the government’s plea for the people to adapt and change its lifestyle as hypocritical and double-standards. There are 5 examples of such irresponsible behavior despite its assurances that it is responsible in managing our country’s finances, implement prudent spending and good governance.

One, is the failure to deal with corrupt officers who have profited from the diesel subsidy at public expense. Fishermen received a diesel subsidy by being charged at RM 1 per liter of diesel. Such diesel subsidy for fishermen rose sharply from 326 million liters in 2002 to 1.2 billion liters in 2005. However the amount of fish caught actually declined from 1.29 million metric tones in 2002 to 1.2 million metric tones in 2005.

Clearly someone is becoming extremely rich in selling this subsidized diesel illegally to non-fishermen. It is unlikely that fishermen are the real culprits as they would be unable to be approved so much diesel unless they can prove it with the amount of fish caught. The most likely suspects are officials from the relevant Ministry who approved the supply of diesel to go up by nearly 900 million liters from 326 million liters to 1.2 million liters. At an average difference of 30 cents from the market price, the country has lost nearly RM 300 million to those connected to the Ministry who abuse the diesel subsidy.

Why is no action taken against enforcement personnel who allow the amount of diesel supplied to go up nearly 3 times yet the amount of fish caught to decline? Clearly the government is confusing policy with implementation resulting in the Malaysian public being punished with higher fuel prices for the failure in enforcement.

Two, the government has asked the people to change its lifestyle yet refuses to practice what it preaches. The government must show leadership by example by instructing all its Ministers and senior government servants to take public transport and reduce expenses to live moderately and cut cots. Any failure to do so would only reinforce perceptions that the burden of the fuel hike would not be shared equally by all but would be borne by the poor and wage earners.

Third is that Malaysians should count themselves lucky as we enjoy paying one of the lowest price amongst South East Asian countries, except Brunei. There is a fallacy in this argument in that we do not want to compare fuel prices with oil exporters like Brunei but only oil importers like Singapore, Thailand and Indonesia who are forced to pay higher fuel prices. One can not compare an apple with oranges. If Malaysia was to compare our fuel prices with other oil exporters, our fuel prices are amongst the highest.

Fourth, if our oil is expected to be exhausted by 2010, there is greater urgency to let fuel price find its real market level of RM 2.46 per liter so that we are prepared for the day when we have to import our oil needs at US$65-70 per barrel. Removal of subsidies prevents market distortion in the actual prices of our products, improve efficiency, cut down losses due smuggling of our cheaper fuel overseas as well as forces the economy to be more competitive and Malaysian workers more productive.

However such removal of subsidies carries a large social cost to the poor. To alleviate the high cost of living faced by the people, especially wage earners and lower income groups, Petronas huge profits of RM 35.5 billion should be shared with Malaysians. Petronas profits of at least RM 35.5 billion for the 2004-2005 financial year would allow every Malaysian to take home at least RM 1,500 per annum. Instead of giving to every Malaysian, such profits should be given only to the needy ones.

If Singapore, which is not an oil exporter can give S$ 2.6 billion in direct cash to Singaporean poor workers and lower middle-class in its 2006 Budget announced on 17 February 2006, why can’t Malaysians benefit from our oil revenue. The time has come for 25 million Malaysians to benefit directly from this oil revenue. We have been denied our rightful share for the last 31 years and it is only fair that Malaysians can benefit in the final four years left in oil revenues before we become an oil importer by 2010. 

Fifth, would the people really benefit from the improvement in transportation system or development projects from the RM 4.4 billion savings in fuel subsidies as a result of the 30 cents fuel hike. When the fuel price was increased from RM 1.37 to RM 1.92 per liter for petrol and RM0.78 to RM1.58 per liter for diesel since May 2004, billions of ringgit were saved in fuel subsidies. However the people did not see any benefit from development projects or improvement in public transport.

Malaysians would want to see some direct benefits from our oil resources instead of it being squandered and siphoned off by cronyism and corruption. DAP considers it unacceptable and even shameful that an oil importer like Singapore can distribute cash to its poor but not an oil exporter like Malaysia. These are the 5 issues that the Prime Minister must address and failed to adequately explain to the public.

(07/03/2006)