The Special Committee will end up a costly failure and will not achieve its objective of easing the burden of the people cause by rising prices if there is no courage in facing the problem of the price hikes head-on.
The current price hikes are caused none other than the wrong policy decisions that raised petrol and diesel prices that raised transportation and costs of production with increases being passed on to consumers. The sugar price hike also caused another round of price hikes.
The unnecessary hike in electricity tariffs and the proposed toll hikes will be causing another round of price hikes. Then again the fall in the ringgit probably caused by the government’s mismanagement of national debt and capital flight due to corruption and others will be another reason for higher price of imported goods. And we have not even reach 2015 and the imposition of GST.
Whether the federal government likes it or not, it need to ask themselves what they did wrong and what wrong policy decisions they made that caused the price hikes. That would be a good starting point for the Special Committee.
After making the wrong decisions that triggered massive price hikes, the PM then announces the so-called 11 half-baked austerity measures. The objective of the 20-sen increase in petrol and diesel prices was supposed to save RM1.1 billion in subsidy savings but it caused many billions of price increases burdening the people. They are both penny-wise pound foolish programs.
And now the Special Committee to evaluate the burden caused by price hikes. All these show that the government’s policy decisions were not well thought out before the decisions were made.
A simple yet effective solution to tackle wastages, excessive spending and curb corruption in government contracts would have saved RM9.3 billion in 2014 based on 20% competitive price by way of open tender of the development budget of RM46.5 billion. If RM1.1 billion is used to offset the petrol and diesel subsidies, the federal government would still save RM8.2 billion.
The DPM and his Special Committee need to have the courage to overturn the PM’s decision on the wrong policy decisions that caused the price hikes. The reversal of the government policies should have an impact on reduction of prices and an immediate impact in reducing the burden of the people.
At the same time, it will put the national economy on a stronger footing.
While the Special Committee is deliberating on the burden of the people caused by the price hikes, they should also consider separately the situation of the people in Sabah and Sarawak. An immediate action that can be taken is the review and abolishment of the cabotage policy and the exemption for Sabah and Sarawak on the petrol and diesel price increase.
The 20-sen hike in petrol and diesel prices cannot save the federal government more than RM300 million from Sabah and Sarawak consumers. But a waiver of this increase will reduce the burden of Sabahans and Sarawakians tremendously.
There is no reason why petrol and diesel from Sabah’s oil and gas resources cannot be sold to Sabahans and Sarawakians at a 20-sen discount to the prices in the Peninsula. The RM300 million subsidy is more than covered by the RM26.6 billion and RM45 billion in oil revenues from Sabah and Sarawak respectively in 2014.
Related news .....
Muhyiddin Announces Special Committee To Tackle Living Cost
No comments:
Post a Comment