SUPP Women chief urges Budi Diesel fix as one-size-fits-all policy unsuitable for Sarawak

Kho Teck Wan

By DayakDaily Team

KUCHING, July 2: The federal government has been urged to fine-tune the implementation of the Budi Madani Diesel targeted subsidy mechanism to better reflect the realities of Sarawak and Sabah, in order to avoid unnecessary disruptions to business operations and daily livelihoods.

Sarawak United Peoples’ Party (SUPP) Central Women chief Kho Teck Wan said while she supports the federal government’s move to curb diesel smuggling and improve subsidy targeting, the rollout must take into account the unique geographical and economic conditions of East Malaysia.

“The first day of implementation had already triggered complaints from users in Sarawak, particularly diesel vehicle owners applying under the programme.

“Many described the application process as confusing, while others experienced system instability that caused their applications to stall or fail,” she said in a statement today.

She added that some companies registered under the Controlled Diesel Subsidy System (SKDS) 2.0 are still waiting for their subsidy cards despite the policy already taking effect, warning that these delays could disrupt business operations.

“These implementation issues should be addressed immediately to avoid unnecessary disruptions to business operations and daily livelihoods,” she said.

Kho, who is also political secretary to Sarawak Premier, also noted that some businesses have discovered they do not meet the eligibility criteria under SKDS 2.0, which could lead to higher transportation and logistics costs in East Malaysia.

“If the current mechanism remains unchanged, transportation and logistics costs in East Malaysia will inevitably increase. These additional costs will ultimately be passed on to consumers, resulting in higher prices for goods and placing a heavier financial burden on ordinary people,” she warned.

She stressed that many small businesses, contractors, agricultural transport operators and rural service providers in Sarawak rely heavily on diesel and risk being unfairly excluded under strict eligibility rules.
“This does not reflect the realities faced in Sarawak,” she said.

Kho further pointed out that Sarawak’s vast geography makes long-distance travel unavoidable, with many residents regularly travelling hundreds of kilometres for work, education, medical care and business activities.

“As such, a uniform monthly quota of 200 litres may be insufficient for many diesel vehicle users in the region,” she added.

She also highlighted fuel specification differences, noting that Sabah and Sarawak use B20 biodiesel while Peninsular Malaysia primarily uses B12, adding that East Malaysia already faces higher logistics and operating costs due to geography.

“Diesel subsidy policies therefore should not simply mirror those implemented in Peninsular Malaysia,” she said, adding that East Malaysia requires a mechanism that reflects its distinct operating environment.

Kho urged the federal government to consider several improvements, including simplifying and expediting the application process, reviewing the monthly consumption cap, and adopting more flexible SKDS 2.0 eligibility criteria for small businesses in transport, agriculture, construction and rural services.

She also called for a differentiated diesel subsidy mechanism for East Malaysia instead of a one-size-fits-all approach.

Kho stressed that Sarawak and Sabah, as long-time contributors to Malaysia’s oil and gas industry, should be fairly reflected in national fuel policies.

“Sarawak and Sabah should not be treated as exceptions. Instead, they should be treated according to their realities. A policy that recognises geographical differences is not preferential treatment; it is equitable treatment,” she said.

She added that while reforms to reduce smuggling and leakages are necessary, they must not unintentionally burden genuine businesses that support employment and rural connectivity.

Kho expressed hope that the federal government would continue to refine the implementation of the Budi Diesel programme to ensure it remains practical, efficient and equitable for all Malaysians.

The federal government officially implemented the nationwide Budi Madani Diesel targeted subsidy mechanism on July 1, standardising the subsidised diesel price at RM2.10 per litre across Peninsular Malaysia, Sabah, Sarawak and Labuan. The new system replaces the previous blanket subsidy with a MyKad-based verification mechanism to ensure only eligible Malaysian citizens benefit from subsidised diesel. — DayakDaily