Central Government Spending Rises 29.4 Percent in First Semester

Finance Minister Purbaya Yudhi Sadewa reported that throughout the first semester of 2026, central government spending reached Rp 1,298.6 trillion, or approximately 41.2 percent of this year’s allocation of Rp 3,149.7 trillion. The spending was used for the payment of civil servant salaries, social security programmes, the Free Nutritious Meals (MBG) programme, and subsidy payments.

Purbaya stated that this realisation grew by 29.4 percent compared to the same period in 2025, which was recorded at Rp 1,003.6 trillion. Central government expenditure consisted of ministerial/institutional spending and non-ministerial/institutional spending.

Ministerial/institutional spending reached Rp 658.9 trillion throughout the first semester of 2026. This was primarily supported by the implementation of the Free Nutritious Meals programme and the distribution of social assistance such as health insurance contributions for the underprivileged, basic food cards, the Family Hope Programme, and also the payment of civil servant salaries, including holiday allowances and the 13th-month salary.

Meanwhile, non-ministerial/institutional spending was recorded at Rp 639.7 trillion. This was focused on the payment of subsidies and compensation for 2026, as well as the settlement of arrears from 2025. Specifically, subsidy and compensation spending in the first semester was driven by fluctuations in crude oil prices, the rupiah exchange rate, and increased distribution volumes for subsidised fuel, subsidised electricity, LPG 3 kg, and subsidised fertilisers.

Purbaya noted that the increase in central government spending acted as a catalyst to support economic growth in the first semester. In contrast, transfers to regions reached Rp 357.4 trillion, a decrease of 11.2 percent compared to the same period the previous year. Overall, total state expenditure in the first half of the year reached Rp 1,656 trillion, or 43.1 percent of the total state budget target of Rp 3,842.7 trillion.