Targeted subsidies may sting, but long-term gains promised

SHAH ALAM - The impact on the government is expected to be less pronounced even though it takes unpopular actions by implementing targeted subsidies starting this year.

However, National Professors Council senior fellow Datuk Dr Jeniri Amir stressed that it was important for the government to explain why such actions were taken because if not, the government's image and popularity will be affected.

He believed that the people would understand and accept the changes if the explanation was effectively communicated.

"The impact will certainly be there on the government, but because it is not an election year, I think it will not be so direct or a very noticeable effect.

"Most importantly, when the people understand, they will not protest or 'explode.'

"The people need to be informed that the action is taken for the sake of long-term economic and financial interests.

"So, a pragmatic and practical yet drastic step needs to be taken because the government cannot always allocate a large budget for subsidies.

"The amount of subsidies borne is so large, up to RM81 billion (in 2023) and that figure will increase if not controlled.

"So, the best step to start something practical and good for the long-term benefit of the country and the people as a whole is through savings or using more appropriate strategies," he told Sinar.

Jeniri also praised the unity government's move and stated that previous governments, including Barisan Nasional (BN) did not dare to take such drastic actions.

He clarified that what was more important was that the savings can ultimately be channelled for the benefit and welfare of the people, but not in the form of subsidies.

"No government can or is willing to do it because this is an unpopular move.

"In general, people want subsidies to continue, but they need to be realistic that with the existing subsidies, it will burden the government and not benefit the country in the long run.

"To save the country from being continuously burdened with subsidies that both local and foreign citizens enjoy, a targeted subsidy approach is more practical," he said.