The current form of subsidies are disproportionately enjoyed by those that do not deserve it, creating an imbalance, she said during the question-and-answer session following the launch of the central bank’s 2022 annual report today.

Shamsiah said that by rationalising the current subsidy schemes, the potential savings can be rightfully channelled to benefit vulnerable groups that need it the most.

“It will result in a reallocation of resources from the rich to those that need it the most.

“It can be argued that it can never be the right time, but it’s something that needs to be done, and there are ways to do it to mitigate the impact,” she said.

She said undertaking the rationalisation will ensure fiscal sustainability and enable the country to strengthen its social protection system apart from progressing towards a greener economy.

“It will contribute towards a greener future and reduce the carbon footprint in the economy,” the central banker said.