Govt to Redirect Fuel Subsidy to Productive Sectors

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  • Perusahaan Gas Negara Prioritaskan SPBG Dekat SPBU

    Perusahaan Gas Negara Prioritaskan SPBG Dekat SPBU

    TEMPO.CO, Jakarta - The government is planning to reallocate fuel subsidy to a number of productive sectors, including irrigation for agriculture and boat procurement for fishermen, according to Energy and Mineral Resources Minister Sudirman Said.

    “When [the fuel price hike is] decided, we will announce [the subsidy reallocation program]. So there is no need for commotion,” Sudirman said after a discussion about energy resilience in Jakarta on Saturday, November 1, 2014.

    The government has earmarked a compensation fund of Rp5 Trillion (US$415 million) for fuel price hike in the Revised State Budget this year. Finance minister Bambang Brodjonegoro said the fund will be provided to protect lower-class economy people from being affected by the fuel price hike.

    “It’s like a social protection for people,” Bambang said.

    Earlier, Coordinating Economic Minister Sofyan Djalil said on Friday, October 31, 2014, that fuel subsidy must be reallocated to more productive sectors before the end of the year to boost economic growth, absorb manpower and reduce fiscal burden.