National Economic Council (DEN) Chairman Luhut Binsar Pandjaitan has\nsuddenly spoken about reforming the national electricity subsidy. Luhut\nbelieves this is important to reorganise the targets for national energy\nsubsidies, which are still largely enjoyed by groups of people who are\nnot entitled to them.<\/p>\n
Luhut explained that the current burden of energy subsidies is still\nabove Rp300 trillion per year. According to him, there needs to be a\nchange in the aid distribution scheme, including in the electricity\nsector, so that the state budget can be allocated more fairly for the\nlower classes.<\/p>\n
\u201cFrom the data we have managed to gather, the energy subsidy burden\nremains above Rp300 trillion per year. Ironically, around 62.9% is\nenjoyed by the well-off. This is clearly unjust and there needs to be a\nreorganisation of subsidy targets,\u201d Luhut said in an Instagram post, as\nquoted on Wednesday.<\/p>\n
Luhut conveyed the plan during a Hearing Meeting with the National\nFinancial Accountability Board of the Indonesian House of\nRepresentatives. He considers it necessary to change the subsidy pattern\nfrom commodity-based assistance to fully individual-based direct\nassistance, referring to the National Single Socio-Economic Data\nsystem.<\/p>\n
\u201cWe need to change this policy by shifting commodity-based subsidies\nto fully individual-based direct assistance. In accordance with\nPresidential Instruction Number 4 of 2025, we will shift the database to\nthe National Single Socio-Economic Data so that the lower classes are\ntruly protected,\u201d Luhut explained.<\/p>\n
In its implementation, the government will utilise GovTech\ntechnology, which includes a biometric verification system, to close\nloopholes for data manipulation in the field. The use of this\ntransparent digital system is projected to provide state savings of up\nto Rp29.9 trillion annually.<\/p>\n
\u201cThis digitalisation step is important to cut through bureaucratic\ncomplexity and close data manipulation loopholes that have been a source\nof state losses. Through a transparent system, we can save state coffers\nup to Rp29.9 trillion per year while ensuring the state budget is\nprecisely targeted,\u201d he added.<\/p>\n
Currently, the digital subsidy system model is being expanded for\ntrials in 42 districts and cities before being implemented nationally.\nLuhut hopes that such assistance will not only serve as consumption\ncosts but can be used by the people as capital to build productive\nbusinesses.<\/p>\n
\u201cWhat must be noted is that subsidy reform is not about reducing the\nrights of the poor, but rather ensuring that every rupiah of the state\nbudget truly reaches those entitled to it. With courage in execution, I\nhope this change will eventually realise social justice,\u201d he\nconcluded.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/luhut-calls-for-electricity-subsidy-reform-demands-shift-in-scheme-1781059963", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }