Malaysian Prime Minister Abdullah Ahmad Badawi, trying
to assuage public anger over a steep hike in fuel prices, said on
Monday government ministers would take a 10 percent cut in
allowances.
Abdullah also said that ministers' overseas holidays
would be reduced and mega projects delayed to save costs.
Together the measures will result in a saving of 2
billion ringgit, ($613 million), he told reporters after a meeting
on ways to cushion the impact of high fuel prices.
"The government also feels the people's pain and the
top leadership should lead by example in facing this challenge. As
such, the entertainment allowance for the prime minister, deputy
prime minister and ministers and deputy ministers will be reduced
by 10 percent," he said.
Spiralling crude oil prices have driven up the cost of
some states' fuel subsidies to near crippling levels.
Malaysia followed India, Indonesia, Taiwan and Sri
Lanka last week, raising pump prices and provoking a public outcry
and protests by opposition groups.
On Monday, Nepal's government said it had sanctioned a
rise in fuel prices, and truckers in South Korea vowed to stop work
over the high cost of diesel.
Abdullah said the decision to increase the price of
fuel was a difficult one, but there had been no choice.
Petrol prices were increased by 41 percent and diesel
63 percent in line with a global surge in oil prices, a measure
that would drive inflation to a 10-year high of 4.2 percent in
2008.
"In all honesty, it was a difficult and agonising
decision to make. Many times, we have been tempted to walk away
from such a difficult decision," Abdullah told an energy
conference.
Fight for
Survival
Since May, Abdullah has been fighting for his political
survival after his coalition endured its worst performance at the
ballot box in 50 years of rule.
The fuel hike has further soured the mood in the
country, and the opposition has been trying to seize on the popular
discontent.
Abdullah's political future remained at risk and the
new measures did not add up to much, political analysts said.
"The measures are too little. It's just cosmetic, it
cannot dampen the anger of the people," said political analyst
Yahya Ismail.
Cutting
ministers' allowances won't save a great deal of money in any case
because, unlike their counterparts in countries such as Singapore,
they don't earn a lot, said Khoo Kay Peng, another
political analyst.
"There are more critical things that the government
should look into, such as cutting down and streamlining the public
sector," he said.
Malaysia's main stock index was down 1.37 percent on
Monday in step with stocks across Asia, and the ringgit fell about
a quarter of a percent, again tracking currencies in the region as
investors fretted about record high oil prices.
State media reported last week that the government also
planned measures such as widening the social safety net for the
poor, increasing the number of price-controlled items and improving
public transport.
The government says it will save 13.7 billion ringgit
($4.2 billion) as part of a broad overhaul of its heavily
subsidised energy pricing system, and days after the hikes were
announced there has been some recognition of the government's
plight.
"Either we bear the pain now and become more efficient
and productive, or let our future generations carry the burden of
high national debts and continuing with our wasteful ways," the
Edge financial daily said.
Pump prices for petrol in Malaysia are still among the
cheapest in Asia.
