He criticised the major U-turn by Putrajaya from the stand it had made earlier this month that a ceiling price will be set on a weekly basis from next month, and petrol retailers can then be competitive by lowering their prices should they choose to.
“I had supported the ‘free competition below ceiling price’ policy because the ultimate beneficiaries of the policy will be the man-on-the-street.
“Competition will allow more efficient petrol companies to offer lower prices to consumers,” the DAP national publicity secretary said, calling for the government to prioritise the interest of the rakyat who are burdened with increasing prices of essential goods and services.
Yesterday, in a special live telecast on TV1, Domestic Trade, Cooperatives and Consumerism Minister Hamzah Zainudin said the weekly petrol and diesel prices fixed by the government will be announced every Wednesday and the prices will come into effect after midnight (Thursday morning).
He said the first announcement on the new mechanism would be on March 29 and the new prices would be effective March 30.
“However, petrol companies and station operators which want to carry out promotions by giving discounts on the fixed prices can do so after receiving prior approval of the ministry,” Hamzah said.
This announcement reversed Hamzah’s own statement, as reported by Bernama on March 4, that from next month a ceiling price for fuel will be announced weekly and that “a notice highlighting the ceiling price for fuel would be placed at petrol stations throughout the country so consumers would know if prices had been raised or lowered”.
Pua said Bernama reported on March 16 that Second Finance Minister Johari Abdul Ghani had said that “although the ceiling price was determined by the government, it was up to the oil companies to sell the petrol and diesel below it”.
“I received a reply from the finance minister in the Dewan Rakyat earlier this week that ‘with regards to the proposal to fix ceiling prices for petroleum products, it is still in the study and evaluation stage’.
“This was the first clue that a U-turn was imminent, as the sequence of events clearly showed that the government came under pressure from oil companies who protested against the policy which allowed them to compete freely,” the Petaling Jaya Utara MP said.
Pua believes that the claim by Hamzah that oil companies or petrol retailers wishing to sell at a lower price or hold promotions will be able to do so subject to approval, is just empty talk.
“The whole process will likely be cumbersome and could even be subject to protests by the other companies,” he said.
“Why should these oil companies remain ‘protected’ by the government when petrol and diesel are no longer subsidised by the taxpayers?
“What makes these oil and gas companies so special that they deserve special protection compared with other goods and services?” Pua said, adding that the biggest winners now are Petronas, Shell, BHP, Petron and Caltex.
He said the policy also contradicts the spirit and intent of the Competition Act which forbids price-fixing and monopolistic practices in nearly all of the other industries.
“Even trade associations such as the Coffee Shop Association have been told that “fixing” coffee or tea prices – which have been their practice for decades – is now illegal under the Act.”