KUALA LUMPUR, March 3 — The actual expenditure on diesel subsidies decreased to RM6.2 billion in 2025 compared to RM10.1 billion in 2024, resulting in savings of about RM4 billion, said the Finance Ministry (MOF).
It said the savings were achieved through the retargeting of diesel subsidies in Peninsular Malaysia via the Subsidised Diesel Control System (SKDS 2.0), which was implemented from June 10, 2024, to December 31, 2025.
“The retargeting of the diesel subsidy also successfully curbed leakages due to smuggling and usage by ineligible business sectors, as reflected in the reduction of retail diesel purchases at petrol stations to four billion litres in 2025 compared to seven billion litres in 2024,” the MOF said in a written reply to the Dewan Rakyat published on the Parliament website today.
The ministry said this in response to a question from Ahmad Fadhli Shaari (PN-Pasir Mas) about how much actual savings were generated from subsidy rationalisation, including fuel and targeted aid, and how the funds were redistributed to the people.
The MOF explained that the savings from the subsidies were returned to those in need while part of the funds was used for socio-economic development and to create a more inclusive social protection network.
Among the initiatives were Rahmah Cash Aid (STR), Rahmah Basic Aid (SARA), which represents the highest allocation ever provided compared with RM8 billion in 2022, and the Early Schooling Assistance (BAP) amounting to nearly RM800 million.
Meanwhile, the MOF said that over 141,000 companies, involving 368,000 vehicles, have benefited from the MySubsidi Diesel Programme through SKDS from June 2024 to January 2026.
As for recipients of the BUDI Individu and Budi Agri-Komoditi cash assistance, 344,817 recipients have received distributions amounting to RM1.05 billion.
The MOF said maintaining subsidised diesel prices for logistics and public transport vehicles is a strategic step to ensure supply chain costs are stable.
The ministry was responding to a question from Datuk Ahmad Marzuk Shaary (PAS-Pengkalan Chepa) who asked about the impact of the diesel subsidy retargeting on transport and food costs, including review mechanisms and targeted compensation to ensure increased costs are not passed on to consumers.
