KUALA LUMPUR, Nov 21 ― Putrajaya must reveal its new pricing system for RON95 petrol and diesel which will underpin the roll back in subsidies for the items starting December, DAP's Liew Chin Tong said today.

Earlier today, the federal government announced that it will use the managed float mechanism for RON95 petrol and diesel ― instead of continuing to provide subsidies that would enable Malaysian consumers to pay a fixed rate regardless of increases in market prices.

Liew expressed DAP's "cautious" welcome of the government's plan to change to the new managed float system due to the anticipated savings for Malaysians, highlighting that the price for crude oil in the global market had already fallen below the current fixed rates of RM2.30 and RM2.20 per litre for RON95 petrol and diesel respectively.

But Liew also urged Putrajaya to lay down the formula which it will use to set the fuel price paid by consumers along with plans to handle any increases in global market prices ― which would then bump up fuel prices under the new system.

"Second, the Government must disclose the formula for the managed float, which industrial players call “dirty float”, for greater transparency.

"Third, the Government must also draw up a plan of what it would do in the event that the petrol price rises again to ease the burden of the people," the Kluang MP wrote in a brief statement today.

Beyond all these short-term matters, however, Liew called on Putrajaya to train its sights on cutting down the public's need to rely on diesel and petrol.

"Fourth, in the long run, the Government must invest a lot more to create an efficient and affordable public transportation system so that the Malaysian public will rely less on private vehicles, hence end our dependence on petroleum," he said.

Liew also said today's announcement has validated the federal opposition Pakatan Rakyat's criticism of Putrajaya's fuel price hike last month ― when the federal government slashed subsidies despite falling global crude oil prices.

He claimed that the move today was a "U-turn" that the government was forced to make after "ensuing panic" due to the chain effect of the fuel price hike on the prices of other goods.

"And, since through this move the Government recognised that the global crude oil price is likely to continue to fall, I would like to renew the call for Prime Minister and Finance Minister Datuk Seri Najib Razak to present a revised Budget 2015 to Parliament as both the subsidy figures and revenue estimates are far off from original estimates," he said.

Malaysia is also an oil-producing and oil exporting nation, with state oil giant Petronas contributing billions towards the government's revenue.

Today, Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Hasan Malek said the Cabinet's decision was carried out due to the success of the managed float system for RON97 petrol, adding that the government had already carried out studies before the latest move.

The RON97 petrol has already been put on the managed float system since July 2010 and is not subsidised by the government. It is now sold at RM2.55 per litre following a 20 sen slash earlier this week under this system.

Hasan explained that the managed float mechanism would see the price of RON95 petrol and diesel reflecting increases or decreases in the prices of crude oil in the global market.

Hasan said the retail price of these two fuel next month will depend on the total average cost during this month, saying that the RON95 petrol is expected to be priced cheaper if the current trend shown earlier this month continues.

The government had in recent months justified the need to cut fuel subsidies and shift to a targeted subsidy approach that would help needy Malaysians receive aid more effectively and directly.

Prime Minister Datuk Seri Najib Razak said last month that Putrajaya had paid RM24 billion in 2013 to subsidise fuel, petrol, LPG and diesel and would risk having insufficient money for government revenue if the figure was not trimmed down.