GLP subsidy to poor households

[NewsWhore]

Industry and Commerce Minister Melanio Paredes said yesterday that the government would only maintain the propane gas (GLP) subsidy for household use supplies. Paredes said that the GLP will be distributed through the Unique Beneficiary System (SUIBEN) that identifies poor families in the DR. Many vehicles have converted to GLP, but the government says only 23,000 pre-selected public transport vehicles will be eligible for subsidized GLP. For other vehicles, the government is backing a program to help vehicle owners convert to lower-costing natural gas. In November 2007, President Leonel Fernandez had already announced that as part of his energy saving plan public transport vehicles would be equipped with natural gas converters. Paredes, quoted in Hoy, said that in the next 60 days Fernandez would receive a new proposal aimed at radically changing the GLP subsidy distribution. Paredes explained that in the 2008 budget RD$5 billion was allotted to subsidize GLP and that 60% of that subsidy has been consumed to date. As reported in El Caribe, Paredes says that these subsidies are not sustainable in the context of the rising fuel prices.
Economy, Planning and Development Minister Temistocles Montas said that if fuel prices continue to rise at their current pace, the fuel subsidy would reach US$1 billion, which is US$400 million more than was budgeted for 2008. This will represent a 66.7% increase in the fuel subsidy for 2008.
The economic cabinet of the Fernandez administration will be meeting today to discuss the rising fuel prices.

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