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The Finance Ministry Should Hold Dialogues And Consultations Before Implementing A Fleet Card System For All Commercial Vehicles Seeking To Benefit From The Government’s Diesel Subsidy To Avoid Problems Faced By Fishermen’s Diesel Subsidy.

Press Statement

by Lim Guan Eng  

(Petaling Jaya, Thursday): DAP calls on the Finance Ministry to hold dialogues and consultations before implementing a fleet card system for all commercial vehicles seeking to benefit from the government’s diesel subsidy to avoid similar problems faced by the fishermen’s diesel subsidy. Fishermen who enjoyed cheaper diesel rates faced a severe shortage of supply even though Malaysia is an oil-producing country.

As part of the government’s efforts to reduce losses and subsidies, diesel prices are expected to hit RM 1.60 per liter from the present RM 1.28 per liter. To mitigate the effects of the high diesel prices, the Finance Ministry intends to introduce a smart card known as a fleet card system. Only those with a fleet card will be able to enjoy buying diesel at lower subsidized rates of around 20 cents per liter.


This fleet card is open only to commercial vehicles registered with the Lembaga Pelesenan Kenderaan Perdagangan ( LPKP). All commercial vehicles registered will be put up on LPKP’s website, raising questions whether such a list is complete. Oil companies will issue these fleet cards to transport companies and private owners based on this list and only those with fleet cards can buy their quota of diesel.


Such a system may raise problems as the oil companies are empowered to issue or not to issue such fleet cards. Big transport companies will not face problems but those with only one vehicle may find difficulty applying for a fleet card from oil companies who are not interested in the problems and trouble in processing one fleet card.


Oil companies do not have an incentive to issue fleet cards as they have to claim the difference in the subsidies from the government. As the government takes up to 9 months to reimburse the diesel subsidies, oil companies lose up to tens of millions in lost interest.


Further, there may be manufacturing or construction companies who own lorries to transport their own company’s goods but are not transport companies may not get fleet cards as they are not registered with LPKP. 


It is unfair for any system introduced that denies small-time businesses from enjoying fuel subsidies available to larger companies to pay lower petrol prices. DAP calls for the removal of any proposed fleet card system that is unnecessary, complicated and even expensive system and which only burdens consumers and businessmen.


If the government can not afford to continue to subsidise petrol, Petronas can. It is irresponsible and unethical for Petronas to continue to earn huge profits from high petrol prices at the expense of Malaysians consumers. A more effective approach is to raise fuel prices according to international prices to remove problems of inefficiencies, black-marketeering and corruption associated with a subsidized fuel price 40% lower than the international market price.

Petronas earned RM 35.5 billion in 2004. This does not include the RM 31.2 billion given out to the government. Even if Petronas gave RM 1,000 to every single Malaysian, it would still have RM 10.5 billion left. The time has come for Malaysians to enjoy the benefits of our own natural resources.



* Lim Guan Eng, DAP Secretary-General

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