Hike in various tariffs

Hike in various tariffs

From Media Indonesia

The Media Indonesia edition of Jan. 2, 2001 published a story titled The government will soon increase fuel prices". Every year ordinary people are burdened with the fear of a fresh fuel price rise. Moreover, the tariffs on fuel, electricity and telephone will go up in 2002. Of course, people at the grass-roots level will suffer more.

I am really amazed by the oil and gas director general's acknowledgment that some 70 percent to 80 percent of the fuel subsidies have been channeled to the wrong targets. I, for an example, am one of those enjoying these subsidies from the state- owned oil company (Pertamina) every day.

If the director general has learned that about 70 percent to 80 percent of fuel subsidies have gone to the wrong people, why should the fuel price be continually increased with the age-old reason of reducing the burden on the state budget?

If this acknowledgement is right, the country's cabinet of reform has lost between Rp 56 trillion and Rp 64 trillion while in the year of 2002 it will, again, suffer further losses of between Rp 28.7 trillion and Rp 32.8 trillion.

While this director general is currently holding the power, he can make the following efforts to make sure that the fuel subsidies should no longer reach the wrong targets: 1. Fuel subsidies should be given only to public transportation vehicles, ordinary people and small-scale entrepreneurs. 2. Market prices should be imposed on private vehicles. It can be higher, if necessary, to ensure that the cross subsidy of fuel will be achieved so that it won't be a burden to the state budget. 3. Organization of Land Transportation Owners and the Indonesian National Shipowners Association can be invited to discuss the realization of the fuel subsidies for public land and sea transport. 4. If fuel subsidies are channeled only to public transportation vehicles, God willing, the price of goods will not spiral, therefore allowing the ordinary people to breathe a sigh of relief.

M. BACHTIAR

Jakarta