MP proposes phasing out cooking oil price stabilisation scheme

A Public Accounts Committee report highlighted shortcomings in the cooking oil price stabilisation scheme (COSS), such as excess quotas and flawed subsidy management. The government has been urged to gradually dismantle the COSS and allocate its budget to more focused assistance programs like Sumbangan Asas Rahmah (SARA). Tan Kar Hing (PH-Gopeng) argued that this change would lead to more efficient use of public funds, particularly as the government confronts fiscal constraints and mounting debt servicing expenses.

The COSS, which has received RM10.879 billion from 2019 to 2025, has been criticized for its foreign ownership, with 67% of its quota controlled by overseas entities, and inadequate local management. Some refineries and cooking oil packaging companies have not received payments transparently. Tan also pointed out that only a small portion of the scheme benefits local companies, and there are instances where the product is unavailable in the market, raising enforcement concerns.

He noted that the scheme was not originally designed for businesses, although some microenterprises reportedly utilized its subsidized cooking oil. When discussing the fiscal outlook for 2027, Tan cautioned that the government should be wary of the RM380 billion revenue projection, which has not factored in the implications of recent fiscal measures like tax cuts for individuals and corporations.

Additionally, the government recently ordered a RM10 billion reduction in operating expenditure across all ministries, with projected debt servicing costs expected to reach RM61 billion the following year. Tan questioned the government's ability to maintain a surplus budget in the upcoming years and sought clarification on strategies to prevent further spending cuts.