DAP: Opposition pressure forced Putrajaya to postpone subsidy cuts

By Clara Chooi | May 26, 2011
The Malaysian Insider

KUALA LUMPUR, May 26 — The DAP triumphed today in Putrajaya’s postponement of fuel and gas subsidy cuts, claiming it was largely due to opposition pressure that forced the government to back down.

It however warned that the celebration would likely be short-lived, predicting that the cuts would be imposed after snap elections.

n a statement, party secretary-general Lim Guan Eng (picture) listed three likely reasons behind the decision — Pakatan Rakyat (PR) had successfully exposed the large subsidies enjoyed by corporate giants, Barisan Nasional (BN) intends to hold snap elections soon and the ruling pact fears pushing subsidy cuts would cause a loss of popular support.

“Such unfair price increases will not go down well with the voters. BN is worried about the surprising electoral strength of PR,” he said.

Lim however noted that since no deadline had been imposed on the postponement, the government was likely to proceed with its plan to cut subsidies after snap elections are called.

“Domestic Trade, Co-operatives and Consumerism Minister Datuk Seri Ismail Sabri Yaakob refused to specify how long the government would maintain current prices.

“In other words, once the snap elections are won by BN, then clearly nothing would stop them from removing subsidies and allowing prices to increase,” he said.

The Bagan MP also pointed out that Deputy Prime Minister Tan Sri Muhyiddin Yassin had declared recently that a subsidy review was necessary as the government expects the subsidy burden to double from RM10.32 billion to RM20.58 billion this year.

Lim predicted that corporate giants like independent power producers (IPPs), TNB and Felda would likely escape subsidy cuts, pointing to recent statements made by MCA president Datuk Seri Dr Chua Soi Lek and Energy, Green Technology and Water Minister Peter Chin Fah Kui.

“Peter Chin had insisted that the RM19 billion savings enjoyed by independent power producers and TNB annually are not a subsidy but merely profits foregone by Petronas in selling gas at 25 per cent of market rates.

“Dr Chua had declared that gas subsidies to IPPs cannot be abolished as it is tied up in agreements,” he said.

Lim also slammed Domestic Trade, Co-operatives and Consumerism Deputy Minister Datuk Tan Lian Hoe for accusing the DAP of playing racial politics when it complained that the recent cut in sugar subsidies was unnecessary due to Felda’s high profits.

“This is a stupid argument by Tan as those affected by the price increase of sugar by 20 cents to RM2.30 per kg include Malays. Or is Tan saying that price increases in sugar and petrol affect only non-Malays?” he said.

  1. #1 by boh-liao on Thursday, 26 May 2011 - 7:03 pm

    Ha, ha, ha – PR (DAP, PAS n PKR) can FORCE UmnoB 2 back down, but MCA, Gerakan, MIC can only kow tow 2 UmnoB

  2. #2 by sheriff singh on Thursday, 26 May 2011 - 7:54 pm

    “Peter Chin had insisted that the RM19 billion savings enjoyed by independent power producers and TNB annually are not a subsidy but merely profits foregone by Petronas in selling gas at 25 per cent of market rates.”

    If it is not subsidy, then is it a ‘donation’, ‘gift’, ‘ang pow’ or whatever. Stop the semantics.

    By foregoing RM 19 billion profits, Petronas gives less to the government for the country’s development. Why must this be so? Are they Santa Claus? Which part of their Constitution gives them the power to ‘give up’ profits? Shouldn’t then the directors be held to account individually and collectively for power abuse, breach of fiduciary duties etc etc.

    Does Petronas pay taxes? If so, the Tax Authorities have been deprived of tax, possibly improperly, for the ‘profits foregone’ amounting to RM 19 billion.

    As for the IPPs, they should pay ‘windfall profit’ taxes for their huge incomes. We should study all their accounts and tax returns carefully, whether they have been paying their taxes in full.

    This is why Petronas’ accounts must be made public in full and tabled in Parliament as well for accountability. As it stands, it reports to no one except …..

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