The ministry of domestic trade and consumer affairs (KPDHNEP) has announced that the implementation of the petrol subsidy programme (PSP), which was originally planned to take place in January 2020, will be deferred to a later, unspecified date.

In an official press release released today (December 30, 2019), the ministry said the decision to delay the PSP was made following a Cabinet meeting held on December 18.

According to the ministry, the move will allow for more initiatives to be undertaken to ensure the public were well informed and prepared for the programme’s implementation. Additionally, the deferment gives the finance ministry room (and time) to continue the registration process of those in M40 group who are eligible for the PSP.

Pending an official update that will be announced later on, the public will continue to pay for petrol following prices set by the current system, where RON 95 is fixed at RM2.08 per litre, while the price of RON 97 is floated (currently at RM2.63 per litre).

The government first revealed details of the PSP back in October 2019, where eligible B40 recipients – includes those who are entitled for cost of living aid (BSH) assistance – would be given a fixed subsidy rate of RM30 a month for car owners, and RM12 for motorcycle owners.

At the time, it was also announced that the current price cap of RM2.08 per litre for RON 95 will be removed and the fuel floated – like RON 97 is presently – once the PSP came into effect.

Later on, following tabling of Budget 2020, the government extended the coverage of the PSP to include those in the middle income M40 group, with the issuance of a “Kad95” for those with household incomes of below RM4,000 but are not eligible for BSH. It added that RM2.4 billion was allocated to the programme, which would benefit around eight million individuals in the B40 and M40 groups.

Details of the PSP are as follows:

  • The subsidy will only be given to car/motorcycle owners, and is limited to one vehicle per recipient. If a person owns a car and a motorbike, then he/she will receive the higher subsidy, which is for the car. The car or motorcycle must be registered under the recipient’s name.
  • The subsidy rate will be capped at RM30 a month for car owners, and RM12 a month for motorcycle owners.
  • The government will reimburse the subsidy once every four months, so car owners will receive RM120 and motorcycle owners will receive RM48 every four months. The payment method will see cash being directly credited into the recipient’s registered bank account. The first payment is scheduled for April 2020.
  • Only those who are entitled for cost of living aid (BSH) assistance, with their names listed in the BSH database for receiving such allowances, will be able to receive the new petrol subsidy. All handicapped people will also be given the subsidy.
  • The household income of the recipient must not be more than RM4,000 per month.
  • To qualify, a recipient can only own a maximum of two cars and two motorcycles at any one time in his/her household. See the info-graphic panel above for a clearer picture of what vehicle combination qualifies and what doesn’t.
  • For cars, the pre-requisite is that the engine displacement must be:
    1,600 cc or below
    – or above 1,600 cc, but only for cars that are 10 years old and above
  • For motorcycles, the pre-requisite is that the engine displacement must be:
    150 cc and below
    – or above 150 cc, but only for motorcycles that are seven years old and above