APBN Deficit Widens, Time for Prabowo to Reorganise Priority Programmes

The war in the Middle East and global geopolitical instability are once again pressuring the world economy. One of the most tangible impacts is the surge in crude oil prices exceeding the basic assumptions of the 2026 APBN. The government set an oil price assumption of around 70 US dollars per barrel with an exchange rate of Rp 16,500 per US dollar. However, in global developments, oil prices have occasionally moved above 100 US dollars per barrel. This surge is not merely a statistical figure. It directly pressures the APBN through increased energy subsidy burdens. When oil prices rise while domestic fuel prices are held back for social stability, the difference must be borne by the state. In this context, the 2026 APBN structure shows significant pressure. The government targets state revenues of Rp 3,153.6 trillion, while state expenditures reach Rp 3,842.7 trillion. The structure of state expenditures illustrates how fiscal space is increasingly narrowing. Ministry/institution expenditures reach Rp 1,510.6 trillion, non-ministry/institution expenditures amount to Rp 1,639.2 trillion, and transfers to regions are around Rp 692.9 trillion. Within this, routine expenditures such as civil servant salaries, social assistance, subsidies, and operations consume a large portion of the budget. At the same time, debt interest payments have reached around Rp 599 trillion per year, a figure that continues to rise and significantly absorbs fiscal space. Amid these pressures, the 2026 government is still pushing several major programmes simultaneously. The Free Nutritious Meals programme requires a budget of around Rp 335 trillion. People’s Schools around Rp 24.9 trillion, Red and White Village Cooperatives (KDMP) around Rp 34.57 trillion, and the construction of TP battalions around Rp 45 trillion. In total, the budget needs for these programmes approach Rp 439 trillion.