Fuel Subsidy Budget Unchanged despite Weak Rupiah
9 October 2015 15:30 WIB
TEMPO.CO, Jakarta - The government dismissed rumors that oil fuel subsidies have inflated due to the rupiah correction against the US dollar. The Ministry of Energy and Mineral Resources said that such a thing only happened in "the previous government's subsidy regime".
"The subsidies are fixed, so there is no way that the budget could bloat," the ministry's director for downstream oil and gas Setyorini Tri Hutami said on Friday October 9.
The government subsidized diesel fuel and kerosene by Rp1,000 per liter. This fixed subsidies come with a condition that whenever global oil prices rise, the prices of Indonesia's subsidized fuel will increase as well.
Rini admitted that the rupiah correction is affecting fuel prices. However, that variable does not change the government's subsidy budget, "unless the state budget is changed; because the [subsidy budget] amount was already determined by the government and the House of Representatives."
The 2015 Amended State Budgets allocates Rp64.7 trillion to subsidize fuel, 3-kg LPG and biofuel. For Solar diesel fuel, the quota is pegged at 17.05 million kiloliters a year.
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