Economist Urges Prabowo to Reallocate MBG Budget

Director of the Center of Reform on Economics (Core), Mohammad Faisal, offered advice to President Prabowo Subianto on government budget policies during a roundtable discussion at Prabowo’s private residence in Hambalang, Bogor, West Java, on Wednesday evening, 17 March 2026. Faisal stated that the sahibulbait’s decision to cut budgets for ministries and agencies needs to be reviewed. That policy, Faisal said, could potentially disrupt transfers to regions, thereby affecting public consumption. Rather than cutting budgets for ministries and agencies, Faisal suggested that the government should reduce allocations for programmes that are not running effectively or are less urgent. “Including refocusing priority programmes, such as the free nutritious meals (MBG),” Faisal recounted from the Hambalang meeting when contacted by Tempo on Friday, 20 March 2026. Prabowo had previously planned to cut budgets in 15 routine spending positions to address the continuously widening national budget revenue and expenditure deficit (APBN). In 2026, several economists predict the APBN deficit could reach nearly 4%—above the 3% limit set in the State Finance Law. The savings from the national budget will be used for priority programmes that were Prabowo’s campaign promises, such as MBG. Faisal presented an analysis of the impact of the budget cut policy that had already been implemented in 2025. That efficiency measure left regional heads overwhelmed in seeking funds to run their programmes. In the end, local governments sought additional revenue by collecting fees from the public. Amid the sluggish economic situation, this government policy triggered large demonstrations in Pati Regency, Central Java. The demonstrations were sparked by the local government’s policy of raising land and building tax rates by up to 250%. In addition, budget cuts led to a slowdown in the tourism and hospitality industries. This was because official travel by ministries and agencies was almost nil. In response to Faisal’s advice, Prabowo stated that the government would continue to implement efficiency policies to prevent the budget deficit from exceeding 3%. Although the chance of policy revision is small, Faisal feels he has fulfilled his role as an economic observer by providing input to the president. “I already guessed that the president’s decision on efficiency is fixed,” Faisal said.