Coordinating Minister Airlangga: Government Cuts Ministry and Agency Budgets to Keep National Budget Deficit Below 3 Percent

Jakarta — Amid increasingly tense global geopolitical conditions, the government has opted to pursue budget efficiency measures across various ministries and agencies (K/L).

Coordinating Minister for Economic Affairs Airlangga Hartarto stated that this policy was implemented as an effort to keep the national budget deficit within the safe threshold of 3 percent.

“The first scenario relates to what happens during a critical situation or crisis. The step being taken as of today is budget cuts to ensure the deficit does not exceed 3 percent,” said Airlangga at the Ministry of Coordinating Affairs for Economic Affairs on Monday (16 March 2026).

Airlangga acknowledged that the government has developed plans to anticipate various scenarios if war conditions worsen Indonesia’s economy.

Therefore, according to Airlangga, the planned amount of budget savings to be implemented by each ministry and agency remains dynamic and heavily dependent on various factors, particularly developments in global oil prices.

On the other hand, the government is also considering potential increases in state revenue from the commodities sector.

However, according to Airlangga, the government will continue to monitor developments in the situation on an ongoing basis.

Evaluation of fiscal policy will be conducted dynamically by monitoring economic conditions every month to determine what further steps are necessary.

“We have, together with the Finance Minister and several ministers from major agencies, already prepared what can be made more efficient,” he explained.

He clarified that the budget efficiency in question will target reductions in goods and services spending by ministries and agencies. This includes government apparatus expenditure—such as new civil service appointments—and ministry and agency official travel.

He stated that each ministry and agency also has a number of programmes that can later be reviewed for budget adjustments.

According to him, the government is still preparing these measures whilst awaiting the completion of data collection, which will be reported to the President before being announced to the public.

“The figure is not yet final because it will ultimately be the President’s decision,” said Airlangga.