Govt urged to give income supplement
Govt urged to give income supplement
JAKARTA (JP): The government should provide an income
supplement to the needy, instead of subsidized food staple, in a
bid to encourage diversification of staple foods, agriculture
analysts suggested on Sunday.
Bungaran Saragih from the Bogor Institute of Agriculture said
the current policy of a price subsidy hampered food
diversification efforts, especially for rice, because it kept
prices of rice relatively cheap compared to other foodstuffs.
"Because the government subsidized rice prices, people rely
more and more on rice. If they get the income subsidy, I believe
many of them will substitute the rice with locally based
foodstuffs such as cassava, corn and sago.
"The same problem has also occurred for wheat flour," he said
in a seminar on the food crisis held by the Association of
Indonesian Catholic Intellectuals.
He recommended the income supplement because it had more
likelihood of assisting the target of poor consumers.
The price subsidy often fails to reach those in need, he
argued, because traders and distributors gained most from the
subsidies.
"But the distribution of this income subsidy will need tight
supervision, which will have to involve public and non-
governmental organizations. It should be transparent, too," he
said.
Center of Agriculture Policy Studies' executive director H.S.
Dillon, who also spoke at the same seminar, added that the
government's subsidies on fertilizers was flawed and should be
discontinued.
Dillon said the high disparity between the subsidized prices
of fertilizers domestically and their international market prices
had encouraged many parties to misuse them for their own benefit.
He said that the subsidy often did not reach the targeted
recipients of small farmers.
Much of the urea fertilizer was exported while the subsidized
Kalium Chloride (KCl) fertilizers were sold to plantation firms
instead of the farmers, he said.
"I don't understand why the government still maintains its
subsidy on input such as fertilizers while the price of rice, the
output is currently released under the market mechanism," Dillon
told The Jakarta Post.
Bungaran said that the country's food crisis had resulted from
the problems in food availability and the declining purchasing
power of consumers.
"The government should focus its efforts on improving
consumers' purchasing power by providing them with jobs. The jobs
should be a real and sustainable work, not only ones from the
several temporary labor intensive projects."
Meanwhile, Dillon questioned the government's projection on
domestic rice production of 46.29 million metric tons for
1998/1999 fiscal year, saying that it was impossible to forecast
now as the crop had yet to be planted.
"How can we make a projection on the production while we
haven't started the planting season yet. We do not even know how
much is the country's rice planting area this year. The
estimation is nonsense.
"The government's recent statement that we will flood the
market with rice in harvest time in January and February was also
baseless."
Minister of Agriculture Soleh Solahuddin said last month that
the country would produce up to 48 million tons of rice this
fiscal year due to his ministry's special efforts. (gis)
JAKARTA (JP): The government should provide an income
supplement to the needy, instead of subsidized food staple, in a
bid to encourage diversification of staple foods, agriculture
analysts suggested on Sunday.
Bungaran Saragih from the Bogor Institute of Agriculture said
the current policy of a price subsidy hampered food
diversification efforts, especially for rice, because it kept
prices of rice relatively cheap compared to other foodstuffs.
"Because the government subsidized rice prices, people rely
more and more on rice. If they get the income subsidy, I believe
many of them will substitute the rice with locally based
foodstuffs such as cassava, corn and sago.
"The same problem has also occurred for wheat flour," he said
in a seminar on the food crisis held by the Association of
Indonesian Catholic Intellectuals.
He recommended the income supplement because it had more
likelihood of assisting the target of poor consumers.
The price subsidy often fails to reach those in need, he
argued, because traders and distributors gained most from the
subsidies.
"But the distribution of this income subsidy will need tight
supervision, which will have to involve public and non-
governmental organizations. It should be transparent, too," he
said.
Center of Agriculture Policy Studies' executive director H.S.
Dillon, who also spoke at the same seminar, added that the
government's subsidies on fertilizers was flawed and should be
discontinued.
Dillon said the high disparity between the subsidized prices
of fertilizers domestically and their international market prices
had encouraged many parties to misuse them for their own benefit.
He said that the subsidy often did not reach the targeted
recipients of small farmers.
Much of the urea fertilizer was exported while the subsidized
Kalium Chloride (KCl) fertilizers were sold to plantation firms
instead of the farmers, he said.
"I don't understand why the government still maintains its
subsidy on input such as fertilizers while the price of rice, the
output is currently released under the market mechanism," Dillon
told The Jakarta Post.
Bungaran said that the country's food crisis had resulted from
the problems in food availability and the declining purchasing
power of consumers.
"The government should focus its efforts on improving
consumers' purchasing power by providing them with jobs. The jobs
should be a real and sustainable work, not only ones from the
several temporary labor intensive projects."
Meanwhile, Dillon questioned the government's projection on
domestic rice production of 46.29 million metric tons for
1998/1999 fiscal year, saying that it was impossible to forecast
now as the crop had yet to be planted.
"How can we make a projection on the production while we
haven't started the planting season yet. We do not even know how
much is the country's rice planting area this year. The
estimation is nonsense.
"The government's recent statement that we will flood the
market with rice in harvest time in January and February was also
baseless."
Minister of Agriculture Soleh Solahuddin said last month that
the country would produce up to 48 million tons of rice this
fiscal year due to his ministry's special efforts. (gis)