KUALA LUMPUR: The country’s main umbrella group for consumer associations said targeting subsidies using the Budi Madani RON95 (Budi95) model can resolve the long-standing issue of abuse and leakages.
The Federation of Malaysian Consumers Associations (Fomca) said the Budi95 model, which links fuel subsidies to MyKad holders, should be extended to other essential subsidies, such as electricity, cooking oil, or basic food items, to ensure fairer and more efficient distribution.
“Using the MyKad system as the foundation, the government could integrate additional socio-economic indicators to better assess eligibility,” Fomca CEO Dr Saravanan Thambirajah told the New Straits Times.
On Monday, Deputy Finance Minister Lim Hui Ying said the government will reassess its phased plan to retarget subsidies for essential goods, including sugar, rice, and cooking oil, to prevent leakages.
Responding to a question in the Dewan Rakyat, Lim said current efforts were focused on ensuring the smooth implementation of fuel subsidy programmes such as diesel and Budi95.
Saravanan said that should the government use a Budi95-like model for targeting other subsidies, it must ensure its database is continuously updated to reflect changes in income, household dependents, and cost burdens.
“Subsidy rationalisation must focus on the most expensive and inefficient subsidies while ensuring that no vulnerable group is left behind.”
He said direct cash transfers or digital vouchers can be used as complementary tools to cushion the impact for low-income families as subsidies are phased out.
“Equally important is transparency on how the government uses the savings from subsidy reforms. When the public can see that rationalisation leads to better welfare programmes, improved infrastructure, and social investment, public trust will grow.”
He also said transparency helps prevent public backlash and misinformation, and this must be supported by monitoring and enforcement to detect and prevent abuse.
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