Electricity prices must rise, says Anwar
Editor’s Note: This article has been amended to better reflect the context of Anwar’s comments and add more details about the tariff increase.
Summary
Prime Minister Anwar Ibrahim says electricity tariffs in the peninsula must rise later this year.
Anwar also denies claims that the EPF foreign worker levy will be cumulative, saying it would remain at two percent.
Prime Minister Anwar Ibrahim today said that electricity tariffs must rise in the second half of this year.
“The decision is to me something which needs to be done because prices have to rise according to the capacity in the price at the particular period,” he told attendees at a Chinese New Year celebration with business leaders at the Shangri-La Hotel in Kuala Lumpur.
He was addressing concerns raised by the president of the Associated Chinese Chambers of Commerce and Industry (ACCCIM) Ng Yih Pyng that the tariff increase could have knock-on effects that lead to higher costs of doing business and inflation.
Last year, Tenaga Nasional Berhad announced a 14.2 percent increase in the base electricity tariff for Peninsular Malaysia effective July this year, from 39.95 sen/kWh to 45.62 sen/kWh.
It cited higher fuel costs as the main reason for the increase.
However, in his speech, Anwar stressed that the increase would not be as high as the 14.2 percent figure would suggest, and would not be cumbersome or disadvantageous to the business community.
For context, the base tariff refers to the average tariff borne by all electricity users. The actual tariff imposed differs based on the type of user, and consumption trends.
The final bill is also affected by any surcharge or rebates under the Imbalance Cost Passthrough (ICPT) scheme, which is adjusted every six months to reflect the actual fuel prices.
TNB previously assured there would be no increase in electricity tariffs for 85 percent of domestic users for the first half of this year, as the government is absorbing the cost through mechanisms such as the Electricity Industry Fund.
The next tariff review is slated for July 2025.
No cumulative foreign worker levy
Anwar also touched on the foreign worker levy, which extends Employees Provident Fund (EPF) coverage to non-Malaysian workers.
He denied claims that the levy would be cumulative, saying that it would remain at two percent.
“The initial proposal was 12 (percent) and the cabinet did consider the bill by the (EPF) chairperson.
“So we just kept it at two (percent) and it will stay for some time until things are much better,” he said.
When circumstances improve, the cabinet will increase it to four percent, he added.
When tabling Budget 2025 at the Dewan Rakyat in October, Anwar announced that the government is looking into getting migrant workers to contribute to the private sector retirement fund.
In his speech today, Anwar called on the private sector to contribute to developing Malaysia’s “centres of excellence”, referring to faculties and training within education and digital transformation.
He cited global superpowers like the US, Europe, and China, which in the past focused on developing these areas.
As Malaysian voters we have poor choices - either vote for this lunatic coalition or the other lunatic coalition.