Johari moots replacing packet cooking oil subsidies with cash aid

It was previously reported that cooking oil in 1kg polybags, sold locally at a subsidised price of RM2.50, can be easily bought in shops in Thailand.

KUALA LUMPUR: Johari Ghani (BN-Titiwangsa) has suggested that Putrajaya replace the subsidies for cooking oil sold in 1kg polybags with direct cash aid to curb leakages.

With about 60 million cooking oil packets produced a month, or 720 million a year, Johari said there have been cases of wholesalers purchasing the polybags at the subsidised price of RM2.50, only to sell them to micro enterprises at a higher price.

“My question is this: does the government want to continue with this method? I believe that it is time for us to see how we can make cash transfers instead for people to buy cooking oil.

“If every B40 household uses about 5kg of cooking oil a month, we can allow them to continue purchasing at RM2.50 per kg by giving cash transfers for the difference between the market price (and the subsidised price),” said the former second finance minister during question-and-answer time.

This way, he said, cooking oil packets can be sold at the market rate while the government will get to save on subsidies while preventing leakages.

Deputy domestic trade and cost of living minister Fuziah Salleh agreed with Johari, saying this “might be the best way” to avoid leakages in the subsidy for cooking oil.

She said this is the direction the ministry is headed, though the mechanism for its implementation is not ready yet.

“Once we get the relevant data from the Padu database, we can implement this targeted subsidy for cooking oil,” she said.

It was previously reported that the cooking oil sold in 1kg polybags had been found being sold in shops in Thailand.

In July 2022, checks by Utusan Malaysia found that nearly every sundry shop in the Sungai Golok market and nearby areas were selling the subsidised cooking oil from Malaysia, as well as other goods with price controls like wheat flour and sugar.