Kuala lumpur: The Public Accounts Committee (PAC) has put forth a proposal urging the Ministry of Domestic Trade and Cost of Living (KPDN) to undertake a comprehensive review of the cooking oil supply chain, recommending a reduction in the quota by 60,000 metric tonnes per month.
According to BERNAMA News Agency, PAC deputy chairperson Teresa Kok disclosed that this recommendation is one of eight made following an investigation into the management of cooking oil price controls and subsidies. The investigation aimed to align these controls with actual domestic needs to prevent public fund leakage and waste. Kok emphasized the need for KPDN to reassess the RM600 per metric tonne subsidy rate provided to packaging companies, suggesting it should be adjusted to reflect current operating costs more accurately.
Kok highlighted that the investigation, involving ten proceedings from August 5 to October 15 last year, summoned witnesses from KPDN, the Malaysian Islamic Development Department (JAKIM), and the Home Ministry (KDN). This followed findings from the Auditor-General's Report (LKAN) 2/2025, which criticized the unsatisfactory management of cooking oil price controls and subsidies.
The PAC's conclusions revealed that the Cooking Oil Price Stabilisation Scheme (COSS) quota, set at 60,000 metric tonnes per month, vastly exceeded Malaysia's actual domestic needs, estimated between 19,000 to 30,000 metric tonnes monthly. Kok noted that the lack of a targeted distribution mechanism resulted in RM10.879 billion in government subsidy funds from 2019 to February 2025 failing to reach the intended beneficiaries, with one-kilogramme packets of cooking oil often misused by ineligible parties.
Additionally, Kok pointed out that two packaging companies lacked halal certification, despite improvements in the certification process by JAKIM. The investigation also uncovered significant weaknesses in managing spoiled cooking oil stocks due to the absence of a specific SOP at the packaging company level, leading to unnecessary subsidy spending on spoiled stocks.
Kok voiced concerns over ineffective monitoring at the retailer level, which has facilitated conditional sales, stock hoarding, and sales exceeding the RM2.50 control price. She also highlighted the imbalance in market share of subsidized cooking oil at the refining level, with foreign companies controlling 67 per cent of the quota, leaving local government-linked companies and other local firms with minimal shares.
The PAC suggested that KPDN should ensure subsidy payments only cover undamaged cooking oil stocks to avoid excessive subsidy expenditures. Furthermore, the government is urged to expedite the shift from bulk subsidies to a fully digital targeted subsidy system through eCOSS, ensuring assistance benefits only eligible citizens and curbing potential exploitation.
Lastly, Kok mentioned the need for the government to explore redistributing the cooking oil refining quota, prioritizing local companies to reduce the dominance of foreign enterprises. The PAC's statement on the Management of Price Control and Cooking Oil Subsidies, presented earlier, outlined these recommendations for immediate government action.