t is haphazard decision hastily decided by a low calibre Badawi cabinet.

On TV3 Badawi prided that the cabinet took 4 long hours to deliberate on the issue! Only 4 hours of deliberation for such an important issue? An important decision of this nature which has a rippling effect on the whole nation should be studied by a competent team of economist, academicians and thinkers for months – not by shallow thinking cabinet ministers in 4 hours!

1.A large number of those two cannot afford motorcycles and small cars take buses to go to work. When petrol price increases, it is a foregone conclusion that the bus owners will increase the fares. Instead of helping the poor, this category of people will be hit by a double whammy – increased bus fares and increase in prices of food, goods and services and everything else!

2.A new small car costs much more than a second hand car. For example, a small new 850cc Kancil cost $27,000 can carry about 4 persons albeit with some difficulty but a second hand 2500cc Volvo 850 costs about $15,000 could carry goods and 5-6 people easily without problem. In fact, we do find a lot of poor kampong folks driving big, old but cheap continental cars/vans/jeeps because it is more suitable for carrying farm produce as well for transporting their large families. Again they will be hit by a double whammy – increase in price of petrol and everything else!

3.In a poor family of 10 people, only one can afford a small car which is used to make 2 trips to transport everybody. Only one will receive a small petrol payment (for one trip) and the other 9 members will have to bear the increased prices of petrol (for 2nd trip), food and everything else.

4.The huge increase in price of petrol will cause a chain reaction on the increase in prices of other goods and services. Whatever small amounts received by the motorcyclist and small car owners will be largely negated by the more than disproportionate increase in prices of goods and services.

5.Which stupid idiot equates rich or poor with the cc of the vehicles? An average office clerk may own a second hand 1300cc proton Iswara costing $7,000 (rebate = $625) while the Robert Kuok’s children can own a fleet of 10 new cars of BMW, Audi and Volvo all less than 2000cc costing $2 millions and get a total rebate of $625 x 10 = $6,250!

6.In Malaysia, the heavier burden is caused by cost of travelling to work. The cost of travelling will have to include:

1. toll charges,
2. amortisation of the vehicle’s cost over the economic useful life of the vehicle, or, for those who have obtained loan financing, the monthly loan repayments,
3. the annual vehicle maintenance cost (tyres, brake pads, engine oil, spark plugs, etc)
4. road tax,
5. Parking; and
6. petrol

If you analyse above carefully a huge chunk of the expenses goes to car amortisation cost and toll charges. Everyone who has travelled overseas knows for a fact that Malaysia has one of the highest numbers of tolls in the country and very high excise duties on cars.

Take a real life example of a typical average worker in Malaysia earning a take home pay after deducting EPF of RM 2,000 a month. He drives a small 850cc Kancil (cost RM27,000) and travels to and from work each day from his home in Cheras averaging about 40 km. His typical monthly travelling cost is:

Amortisation of car for 10 years ($27,000/10/12)………….$225
Petrol (based on current price)……………………………………$200
Maintenance of car…………………………………………… ….……..$100
Road Tax ($50/ 12)…………………………………………… ……………….$4
Parking ……………………………………………… ………….………………$90
Total Travelling Cost per Month……………………………………$619
Percentage of Travelling Cost to Take-Home Pay…………31%

It simply does not make sense that the use of vehicle for travelling to work to earn revenue for the country would be a whopping 31% of his take home pay for a country that is a net exporter of oil. That does not even include his payment for the increased price of petrol and monthly expenditure for food, housing loan, medical expenses, children schooling expenses, etc, which are certain to increase if the prices of petrol increase.

It makes stupid sense to make a small amount of cash repayments to a small portion of the citizens but the cost of tolls, utilities, food, goods and services keep on escalating. I don’t know whether they are aware that not all registered owners are the actual users of the vehicle and how the repayments could go to the actual persons intended.

This way of abrupt petrol price increase would be disastrous to the nation and once the negative chain reactions (stock market slow down, run away inflation, economic slowdown, corporate under-budgets, etc) happen, the nation might not recover from it for a long time.