Government spends Rp203.7 trillion on compensation and subsidies

The government has disbursed an amount worth Rp203.7 trillion for compensation and subsidy expenditures as of 31 May 2026, equivalent to 45.6 per cent of the state budget (APBN) ceiling.

“Subsidy and compensation spending is ensured to continue maintaining the public’s purchasing power,” stated Minister of Finance Purbaya Yudhi Sadewa during the APBN KiTa June 2026 press conference in Jakarta on Friday. Of this total, subsidy expenditure was recorded at Rp94.8 trillion, while compensation reached Rp108.9 trillion.

Purbaya explained that the government has altered the compensation payment pattern for 2026. Whereas compensation payments were previously made at the end of the year, 70 per cent of compensation is now paid monthly. The remaining 30 per cent will be calculated and paid following an evaluation in September. This measure is expected to maintain the cash flow of companies, such as PT Pertamina (Persero), ensuring it remains adequate.

“This was also carried out under the direction of President Prabowo Subianto. Therefore, the government continues to ensure the availability of goods at subsidised prices,” he added.

As of May 2026, the government has maintained the availability of subsidised goods, with details showing that subsidised fuel (BBM) reached 6,310 thousand kilolitres (an 8.6 per cent increase) and 3kg LPG reached 2,858.3 million kilograms (a 2.7 per cent increase). Furthermore, subsidised electricity reached 43 million customers (a 2.1 per cent increase), subsidised fertiliser reached 3.7 million tonnes (a 20.7 per cent increase), and the distribution of People’s Business Credit (KUR) reached 1.93 million debtors (a 0.52 per cent increase).

Central government expenditure has grown rapidly, with an increase of 52.6 per cent (yoy) to a value of Rp1,059.3 trillion. Expenditure by ministries/agencies (K/L) reached Rp517.7 trillion, a significant growth of 58.9 per cent (yoy), while non-K/L expenditure reached Rp541.6 trillion, growing by 47 per cent (yoy).