KUCHING: The Sarawak Petroleum Product Agents Association (SPPAA) has expressed concerns over the federal government’s planned rollout of targeted subsidies, including the RON95 petrol subsidy at RM1.99 per litre under the Subsidised Petrol Control System (SKPS).
The association stressed that Sarawak’s unique operating environment requires further preparations before these reforms can be implemented effectively.
Noting that the Subsidised Diesel Control System (SKDS) 2.0 and SKPS schemes have not yet been introduced in Sarawak, it said that implementing these programmes in rural and small-volume stations will present significant operational challenges.
“Dealers must buy fuel at market prices and wait for reimbursement for the subsidised portion, which may strain cash flow, especially for small operators.
“The two-tier pricing for diesel and petrol requires secure eligibility checks, point-of-sale upgrades, and staff training.
“Increased cashless payments also lead to higher Merchant Discount Rate (MDR) charges, reducing margins.
“SPPAA suggests considering digital payment solutions with low or zero fees to support small and rural stations facing higher costs,” it said in a statement.
While SPPAA welcomed the recent revision of the Automatic Pricing Mechanism (APM) margin for diesel, it said no revision has been announced for petrol APM margins, even as SKPS is expected to be rolled out.
The association said implementing SKPS without an updated petrol margin could further strain the financial stability of dealers, compounding challenges related to cash flow and system readiness.
In light of these concerns, SPPAA has urged both the federal and Sarawak governments to delay the implementation of SKDS 2.0 and SKPS until logistical, financial and digital systems are fully in place.
The association also called for consultations with SPPAA to address these challenges and explore state-supported financial facilities to ease the financial pressure on dealers during the transition.
“Our association fully supports the government’s goal of ensuring subsidies reach the right groups.
“However, we urge that the implementation of these new schemes in Sarawak take into account the operational and financial readiness of stations, particularly those in rural and small-volume areas,” said SPPAA chairman Laura Hartini Maurice.
