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03 June 2010

TNB chief: People must accept gas subsidy reduction

Subsidy reduction for gas is a reality Malaysians must accept in the face of depleting natural gas resources and rising costs, said Tenaga Nasional Bhd (TNB) chief executive officer Datuk Seri Che Khalib Mohamad Noh.

The current subsidy Malaysians are enjoying is not a sustainable structure, he said.

Minister in the Prime Minister’s Department Datuk Seri Idris Jala recently said Malaysia will be bankrupt by 2019 if it does not cut subsidies and reduce borrowings.

During the Subsidy Rationalisation Lab Open Day held last Friday, reducing gas subsidy and increasing electricity tariff were among the recommendations laid out to bring the country’s economy on solid grounds.

The move however is not expected to affect most households as it will only affect those consuming more than 200kWh of electricity.

The government is expected to continue to subsidise the groups of people using less than 200kWh who represent about 56 per cent of the population.

Speaking to Bernama after officiating TNB’s RM1.1 million new building for its Tanjung Malim office here today, Che Khalib asked: “Are you telling me 56 per cent of Malaysians belong to the group that you call hardcore poor?

“No, I don’t think so. I think the government is generous enough to come up with subsidy recommendation to maintain that 56 per cent population still enjoy the subsidised tariff.”

Citing Petronas, Che Khalib said the country’s gas volume was expected to go down by 2016 and despite this, Petronas would have to continue supplying for industries and TNB.

“Come year 2016, they will have to import more gas into the country to ensure gas volume is sufficient to power up our power plants and also for industries to use as well as to meet the growing demand,” he added.

At that point, the gas will be bought at market prices and not at subsidised prices, he said.

“Petronas has to buy expensive and sell cheap? (It’s) Double jeopardy. I don’t think this is a sustainable structure at all,” he reiterated.

Therefore, people have to appreciate the proposal at the Subsidy Rationalisation Lab Open Day for a gradual increase and not an abrupt increase in prices to a level that will affect the economic structure of the country, he said.

However, people could debate on the size of the increase or when the subsidy can be removed gradually, such as whether within five or 10 years, he said.

These decisions could be debated but to go on to say that subsidies remain forever, “I don’t think it is sustainable,” Che Khalib added.

On another development, he said TNB has allocated more than RM10 million to open about another 10 TNB new offices over the next one year to deliver better services to customers.

“Over the next one year, offices will be opened in places such as Grik, Sungai Siput, Parit Buntar and around six are expected to be opened in the second half of this year,” he added.

This is aimed at replacing old offices that are no longer suitable for operations to provide comfortable and efficient services to customers, he said.


Another hint government is going to suck the 'rakyat' soon by price increase of electricity. One of these day sure a smart minister will suggest to reduce parking space for cars throughout the country so that more parking summons, money will be made from 'rakyat'.

Both gas and electricity subsidies are to be cut. Guess who are going to maintain their enormous profits? The cronies-owned IPPs !! They will pay more for the gas and charge it to TNB which pass it on to the consumers.

Look like they are holding the rakyat to ransom. To avoid all this we will have to change BN to PR. Let Pr find the alternative.

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