"Diverting our subsidy in fuel is our last option. The decision will lead to adjustment of the price of several fuels. Some of the subsidizing for fuel will be diverted for more targeted assistance," he noted at a press conference at the Merdeka Palace, Jakarta, on Saturday.
At the press conference, the head of state was accompanied by Minister of Finance Sri Mulyani Indrawati, Minister of Social Affairs Tri Rismaharini, Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif, and Minister of State Secretary Pratikno.
Minister Tasrif announced an increase in the price of subsidized fuel: Pertalite, from Rp7,650.00 per liter to Rp10 thousand per liter; diesel, from Rp5,150.00 per liter to Rp6,800.00 per liter; and non-subsidized Pertamax, from Rp12,500.00 per liter to Rp14,500.00 per liter that is valid from Saturday, September 3, 2022, at 14:30 local time.
"The state's fund should be prioritized to provide subsidies to the underprivileged, and at this time, the government must make decisions in difficult situations," Jokowi stated.
He later noted that the government had taken every action to protect the people from fluctuations in the world oil prices.
"I actually want domestic fuel prices to remain affordable by providing subsidies from the state budget. However, the fuel subsidy and compensation budget in 2022 has tripled, from Rp152.5 trillion to Rp502.4 trillion," he stated.
Moreover, more than 70 percent of the subsidy is used by groups of people, who can afford fuel in full price, such as owners of private cars, he added.
The government has readied direct cash assistance (BLT) for fuel (BBM) amounting to Rp12.4 trillion for 20.65 million beneficiaries. The assistance, worth Rp150 thousand, will be given four times.
The government has also prepared a budget of Rp9.6 trillion for 16 million workers, with a maximum salary of Rp3.5 million per month, in the form of wage subsidy assistance of Rp600 thousand.
"I have also ordered the regional government to use two percent of the general transfer fund of Rp2.17 trillion for public transportation assistance for online motorcycle taxis and for fishermen," he remarked.
The president said that the government was committed to targeting the right beneficiaries in disbursing the assistance.
"The subsidy must benefit the poor," Jokowi emphasized.
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Translator: Desca Lidya N, Resinta S
Editor: Rahmad Nasution
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