KUALA LUMPUR – The government expects the nationwide implementation of its MyKad-based targeted diesel subsidy programme under Budi Madani to reduce fuel leakage by up to one billion litres annually, significantly cutting subsidy losses while strengthening domestic fuel supply security.
Second Finance Minister Datuk Seri Amir Hamzah Azizan said widespread leakage in the diesel sector previously stemmed largely from the absence of a nationwide MyKad verification mechanism, unlike the system already used for subsidised RON95 petrol.
The MyKad-based system ensures that only eligible Malaysian citizens can purchase subsidised diesel, while non-citizens must pay market rates.
“Our estimate is that this will reduce diesel leakage by about one billion litres annually. This will not only reduce improper subsidy payments but also help ensure the stability of domestic fuel supplies,” he was quoted saying by Bernama.
He was speaking at a press conference following a media briefing on the implementation of the targeted diesel subsidy reform in Kota Kinabalu today.
On June 21, the Finance Ministry (MOF) announced that the price of subsidised diesel would be reduced to RM2.10 per litre nationwide beginning in July.
The ministry said the reduction would be implemented through a nationwide reform of the targeted diesel subsidy programme using a MyKad-based verification mechanism, similar to the approach adopted under the Budi Madani RON95 (Budi95) programme.
Amir Hamzah said the diesel subsidy reform would be rolled out nationwide, including in Sabah and Sarawak, using the same framework as the targeted RON95 subsidy programme.
On registration requirements, he said eligible recipients of the basic diesel subsidy would not need to apply, as qualification would be determined automatically through existing government databases.
However, individuals seeking an additional monthly allocation of 100 litres under the BUDI Diesel programme must submit an application through the designated online portal or obtain assistance from Inland Revenue Board (LHDN) offices.
“For the additional 100-litre quota, they will need to submit an application. LHDN officers will assist with the registration process to determine eligibility for the additional allocation,” he said.
He added that the government was confident the MyKad-based mechanism would not pose difficulties, including in rural and remote areas, citing the successful implementation of the Sumbangan Asas Rahmah (SARA) programme.
According to Amir Hamzah, about 1,493 premises in Sabah alone are involved in the SARA programme, including outlets in remote locations, with beneficiary utilisation rates reaching nearly 100 per cent.
“The experience gained through SARA shows that using MyKad as a verification and redemption tool has been well received by the public, including those in Sabah and Sarawak,” he said.
He added that the government would continue engaging stakeholders and gathering feedback to ensure the targeted diesel subsidy programme is implemented smoothly without affecting those genuinely eligible for assistance. – June 23, 2026