Friday, June 6, 2008

Subsidy cut turns up Umno heat on Abdullah

Subsidy cut turns up Umno heat on Abdullah

(Malaysian Insider) KUALA LUMPUR, June 6 — The battle lines for the top prize in Umno were drawn during the ruling party’s two-day retreat. Most supreme council members including Datuk Seri Najib Tun Razak supported Datuk Seri Abdullah Ahmad Badawi’s plan to contest the elections in December and hand over power not long after that. But Tan Sri Muhyiddin Yassin and Datuk Seri Rais Yatim felt otherwise. They wanted Abdullah to step down before December, setting the stage for them to quit the Cabinet and emerge as challengers for the president’s and deputy president’s posts.

While Abdullah may take some comfort from the support he received from his deputy and the majority of supreme council members, this will not spell the end of moves to push him out early or set a succession timetable with a definite hand over date.

The Malaysian Insider has learnt that Najib pointed out that there should not be any pressure or time frame set on Abdullah. He added that party president should be given space to think matters through thoroughly before discussing the succession plan with him.

Still, the general view among council members was that the handover of power should take place not too long after the party elections. This scuttles Abdullah’s hopes of staying on until 2010. Besides the succession plan, a raft of other issues was discussed by supreme council members. This included the need for Umno politicians to win over Chinese and Indian voters and the recent 40 per cent hike in petrol prices.

During the retreat, a few ministers disagreed with the decision to reduce subsidies and allow the pump price of petrol to increase to RM2.70 per litre. In this group were Muhyiddin and Rais. The Malaysian Insider understands that the Foreign Minister was also among a clutch of ministers who during the weekly Cabinet meeting on Wednesday felt that the government should hold off reducing the subsidies for a few months.

But the majority of ministers during the Cabinet meeting including Najib and Muhyiddin felt that the government could not afford to continue with high levels of subsidy for much longer. Since the 40 per cent petrol price hike was implemented on Thursday, there has been an adverse reaction on the ground, including from Umno members.

Stinging SMSes have been sent from the grassroots to politicians in the capital, questioning the fitness of Abdullah and the Cabinet to continue running the country and pleading with the leadership to show empathy.

This strong reaction from the Umno ground may have prompted Muhyiddin to have second thoughts about the timing of the price increase. With the branch elections only weeks away and anger against the hike percolating across the country, Umno politicians seeking higher office in the party will have to distance themselves from this unpopular decision of reducing subsidies.

There is a good chance of many more Umno ministers slamming the price hike before the branches start meeting in mid-July.

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