He said the rollout of the BUDI95 programme for subsidised RON95 petrol had shown that subsidy rationalisation could be done in phases, provided the government clearly defined its target groups and mechanisms.

“BUDI95 has proven that if it is a well-thought-out programme, you can actually introduce subsidy reform gradually.

“Very often, when you listen to consultants, they say let’s go with a ‘big bang’ approach. But because these reforms affect everyone, gradual (changes) is perhaps the better method,” he said at the Affin Market Outlook Conference 2026.

Asked whether the government was slowing subsidy rationalisation due to possible elections, Liew said he did not see political considerations as a factor.

He said the key question was whether the government should slightly reduce the quota under BUDI95 while ensuring as many people as possible continued to benefit from subsidised fuel – particularly lower-income groups – during periods of economic pressure.

He said subsidy reform was not only a fiscal exercise, but also a matter of public understanding and political communication.

“The most important question in subsidy reform is fairness. Who do you give it to? Who do you exclude? How do you explain how much is given and what the purpose is?” he said.

“Because politically, if the vulnerable group is affected by high prices, you may have to pay a high political and social cost,” he said.

Liew also said BUDI95 had allowed the government to better understand national fuel consumption patterns, enabling more precise policy calibration without causing widespread hardship.

He said the monthly quota was initially set at 300 litres per person before being reduced to 200 litres as data showed that 80% of Malaysians used less than 200 litres per month.