Jakarta \u2014 Finance Minister Purbaya Yudhi Sadewa has confirmed that\nthe government prefers to implement budget efficiency rather than\nincrease the state budget deficit ceiling above 3% of gross domestic\nproduct (GDP) amid mounting pressure from global crude oil prices caused\nby Middle East conflict.<\/p>\n
This option was discussed during today\u2019s Limited Coordination Meeting\n(Rakortas) with Coordinating Minister for Economic Affairs Airlangga\nHartarto, held on Monday, 16 March 2026.<\/p>\n
\u201cThe discussion covered it: if fuel prices continue rising, the first\nstep is efficiency. We\u2019re already preparing the necessary measures by\nministries and agencies,\u201d Purbaya stated.<\/p>\n
During the meeting, each ministry and agency was asked to begin\npreparing budget allocations that could be cut. \u201cWe\u2019ve instructed them\nto prepare and determine what percentage of their budgets could be\nreduced,\u201d he added.<\/p>\n
Purbaya said the budget efficiency directive extends to the National\nNutrition Agency (BGN), which implements President Prabowo Subianto\u2019s\npriority programme of free nutritious meals.<\/p>\n
\u201cThere are additional allocations creating bloat. So with the current\nbudget, we\u2019ll focus on existing programmes first. Additional items we\u2019ll\npostpone until circumstances permit, but clearly it\u2019s not possible now,\u201d\nPurbaya explained.<\/p>\n
According to him, the Finance Ministry will begin calculating the\nscope of government budget efficiency starting next week to anticipate\nvolatile global crude oil prices, which frequently exceed US$100 per\nbarrel or surpass the state budget macro assumption of US$70 per barrel,\naffected by US-Israeli conflict with Iran.<\/p>\n
\u201cBut execution isn\u2019t certain yet \u2014 which items get cut, roughly\nspeaking. Later they\u2019ll adjust their policies based on the Finance\nMinistry\u2019s reductions,\u201d he said.<\/p>\n
Purbaya emphasised that efficiency is the best option to counter\nglobal crude oil price pressures rather than widening the state budget\ndeficit. This approach means the government need not add fiscal burden\nthrough additional debt.<\/p>\n
\u201cIt would be easy for me to just say let\u2019s raise the deficit, I\u2019d\nrelax and borrow more, but then you\u2019d all complain again \u2014 the\ngovernment keeps borrowing,\u201d Purbaya stated firmly.<\/p>\n
Additionally, he stressed that the government\u2019s budget surplus (SAL)\nremains sufficiently strong to cover potential widening of the state\nbudget deficit to 3.5% of GDP, equivalent to an additional Rp110\ntrillion from the current deficit projection of Rp698 trillion.<\/p>\n
\u201cIf I only need Rp110 trillion, I can cover it from my SAL \u2014 still\nsufficient, right? I still have savings, so don\u2019t worry,\u201d Purbaya\nconcluded.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/purbaya-chooses-budget-efficiency-continued-borrowing-will-lead-to-public-discontent-1773669265", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }