"Increasing public transportation tariffs is necessary to ensure that the operator does not incur huge losses due to the increase in fuel prices," Transportation Minister Ignasius Johan said.Jakarta (ANTARA News) - Public transportation fares will go up by 10 percent starting November 18 following the governments recent move of reducing fuel subsidies, Transportation Minister Ignasius Johan said.
"Increasing public transportation tariffs is necessary to ensure that the operator does not incur huge losses due to the increase in fuel prices," said Johan.
According to the minister, the government has studied and discussed the new standard for transportation costs carefully by considering factors such as the peoples purchasing power and the continuation of the transportation service. The implementation of the new tariffs will be determined and supervised by Governors, Mayors, and transportation operators in each province and city in Indonesia.
However, Jonan noted, the tariffs for ships connecting islands and land transportations connecting remote areas will not be increased.
The government, on Monday (Nov 17) night, reduced the subsidy on fuel and increased the price of fuel by Rp2,000. The new rate of gasoline is Rp8.5 thousand per liter (it was Rp6.5 thousand/liter earlier) while the subsidized diesel oil costs Rp7.5 thousand per liter (the previous rate was Rp5.5 thousand/liter). The new tariff takes effect from November 18.
President Jokowi stated that the government required a substantial amount of funds to finance infrastructure development and improve its education and health care services.
The President noted that reducing fuel subsidy and raising the prices of fuel was an option that the government had to consider in order to divert subsidies from the consumptive to the productive sectors, including infrastructure and education. (*)
Editor: Heru Purwanto
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