Fri, 15 Sep 2000

Governor uninformed of fuel subsidy

JAKARTA (JP): Governor Sutiyoso is in the dark about the government's plan to provide cash to the city's poor to protect them from the effects of fuel price hikes due in two weeks.

"Although it is already mid-September, the central government has not contacted me, and the city administration cannot prepare anything to anticipate the fuel hikes because there are no guidelines at all," Sutiyoso said on Wednesday.

In the absence of guidelines, Sutiyoso said he did not know whether his administration would be involved with the distribution of the money.

"Up to now, the city administration doesn't know how to distribute the funds, or whether it will affect us or be doled out by the ministry of settlement and regional infrastructure," Sutiyoso said.

The government has decided to reduce fuel subsides, something which will result in a 12 percent rise in fuel prices beginning on Oct. 1. The subsidies, estimated to be Rp 800 billion, will be used to reduce poverty.

The price of premium gasoline will increase to Rp 1,150 (11 US cents) from Rp 1,000 per liter, automotive diesel oil to Rp 600 from Rp 550 per liter, kerosene to Rp 350 from Rp 280, and bunker oil to Rp 400 from Rp 350 per liter.

The government last raised fuel prices in May, 1998. The move led to massive public protests and rioting in Jakarta which contributed to the fall of former president Soeharto the same month.

City Hall spokesman Muhayat said on Wednesday the city would provide statistics on poor families in the city if the central government decided how they were going to distribute the aid.

"In the past, we waited for guidelines from state oil company Pertamina or the finance ministry before making any preparations. But until now, there have been no guidelines at all," Muhayat said.

City administration data reveals that 861,000 people in the capital are living in poverty. (dja)