Replacing the Finance Minister does not guarantee more technocratic\nfiscal management. The root of the problem lies with Prabowo.<\/p>\n
THE dismissal of Purbaya Yudhi Sadewa as Finance Minister does not\nentirely reflect the saying that once something has served its purpose,\nit is discarded. Receiving a phone call about his replacement while\nattending a meeting with the Regional Representative Council (DPD), he\nwas indeed being humiliated. But the abrupt replacement also exposed the\nFinance Minister\u2019s weak bargaining position. Even after accommodating\nthe President\u2019s various demands, including by ignoring a number of\nmonetary principles, he could still be easily kicked out.<\/p>\n
Before his dismissal, Purbaya had just carried out a major reshuffle\nof his subordinates, particularly at the Directorate-General of Taxes\nand the Directorate-General of Customs, two institutions headed by\npeople close to President Prabowo Subianto. Objecting to the reshuffle,\none official went to the Presidential Palace. The reshuffle was put on\nhold, and Purbaya was instead the one who left Lapangan Banteng\u2014the\nFinance Ministry\u2019s headquarters.<\/p>\n
The intrigue was merely the tip of the iceberg. Purbaya had long been\nat odds with several subordinates, including his deputy, Suahasil\nNazara, who later replaced him. Purbaya\u2019s position had previously been\nrelatively secure because he did not cross people close to Prabowo and\nalways followed the President\u2019s wishes.<\/p>\n
Purbaya managed the State Budget to support Prabowo\u2019s favored\nprograms, which consume huge amounts of funds, such as free nutritious\nmeal and the red-and-white cooperatives. To make up for sluggish revenue\nand heavy spending, Purbaya held back revenue sharing funds for regional\ngovernments and tax refunds. He also pressed the Danantara Investment\nManagement Agency to transfer dividends to the state treasury.<\/p>\n
Many have complained about the way Purbaya managed the budget. But\nthose complaints should be directed at both Purbaya and Prabowo. Purbaya\ncarried out Prabowo\u2019s ambitions without reserve, even at the expense of\nfiscal discipline. In other words, whoever becomes Finance Minister will\nrepeat what Purbaya did if he wants to remain in the position.<\/p>\n
Therefore, Purbaya\u2019s replacement is not an indication that Prabowo\nwants to return to more technocratic fiscal policies. The replacement is\nmerely an outcome of a power struggle.<\/p>\n
Minister Suahasil will face a similar challenge. His knowledge and\nexperience in monetary affairs will clash with Prabowo\u2019s ambitions,\nwhich in many respects run counter to economic principles. He will have\nto navigate between two reefs: maintaining fiscal policies that serve\nthe public interest while preserving his loyalty to the President.<\/p>\n
Suahasil\u2019s statement that the State Budget must support the\ngovernment\u2019s priority programs may indeed be unsettling. His statement\nthat he will manage the State Budget credibly must be proven not merely\nby keeping the deficit below 3 percent, but also by spending state money\nproportionally and rationally.<\/p>\n
Confidence in State Budget management can also be restored if the\ncentral government stops shifting the fiscal burden to regional\ngovernments to finance Prabowo\u2019s projects, causing fiscal crises in the\nregions and stalling development and public services. So far, state\nfinancial management has also lacked credibility because the government\nhas concealed state financial risks through institutions such as\nDanantara.<\/p>\n
Credibility will be difficult to achieve if Prabowo does not change\u2014a\nhope akin to trying to measure smoke. Suahasil\u2019s room for maneuver will\nremain constrained by the President and will hit a wall when confronted\nwith the interests of the Palace.<\/p>\n
As Finance Minister, Suahasil must have the courage to rein in the\nPresident\u2019s unreasonable ambitions. He may experience what Sri Mulyani\nIndrawati, the Finance Minister before Purbaya, went through. During Sri\nMulyani\u2019s tenure, spending cuts at ministries and regional governments\nwere once carried out by people close to Prabowo without involving the\nFinance Minister.<\/p>\n
As long as Prabowo continues to push projects that are not urgent but\nconsume huge amounts of the budget, whoever serves as Finance Minister\nwill face the same problem. The Finance Minister will ultimately become\nnothing more than a cashier: finding revenue and paying the bills for\nthe President\u2019s unreasonable projects.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/changing-the-presidents-cashier-1789962634", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }