Bulog Fears Major Loss as Govt Plans to Remove Rice Subsidy

TEMPO.CO, Jakarta – The Indonesian Bureau of Logistics (Bulog) could suffer a major loss if government pushes through with the plan to remove the subsidy for cheap rice for the poor (Raskin) next year. "Hopefully it does not happen," Bulog director of public services Agusdin Farid said yesterday.

Agusdin estimated that the removal of cheap rice subsidy will force Bulog to bear the loss of the 1.7 million tons of rice stored in their warehouse. He also said the plan will threaten Bulog's existence as an agency that serves as the national rice buffer.

SOE Minister Rini Soemarno earlier said the government plans to stop subsidizing cheap rice next year. As an exchange, the government will directly distribute cash to the poor in the form of e-money to buy rice. The plan, said Rini, is expected to make keep social assistances on target.

Yeka Hendra Fatika from the Association of Indonesian Agriculture Graduates rejected the plan's, saying it would be a violation to Law No.18/2012 on Food. If the current program has many errors, Yeka said, the government should improve the system instead of just removing the subsidy. 

JAYADI SUPRIADIN | URSULA FLORENE SONIA