Line up for kerosene or for movie tickets

Line up for kerosene or for movie tickets

Riyadi Suparno, The Jakarta Post

"What's wrong with queuing up? People also queue up at the
cinema."

So said Purnomo Yusgiantoro -- our minister of energy and
mineral resources -- quoting Vice President Jusuf Kalla's
reaction to images of people lining up for fuel.

Like others, Purnomo or Kalla may well have queued up for
movie tickets -- at least before they became minister and vice
president -- but it is unlikely that they will ever be waiting in
line for a liter of kerosene.

The frustrations of people who are forced to wait in a long
queue just for a jerrican of kerosene, perhaps, are not shared by
our top officials. The people are asked to withstand the
scorching sun and face unsteady prices -- most of them will have
to pay more than the government-set Rp 700 per liter. In
addition, they stand before the public exposed as low earners, as
those on a decent wage do not have to queue up for kerosene.

Worse still, in some places, such as the Central Java town of
Surakarta, a family card must be produced by kerosene customers.
Yet, these difficult conditions have not made those who oversee
the business of kerosene any more sympathetic to the poor in
their everyday struggle.

The scarcity of kerosene is not their fault. The blame falls
on the government -- Purnomo, also Kalla and their team -- which
has not distributed kerosene to low-income people in an adequate
quantity, nor on time.

Instead of assuming responsibility for its failure to
distribute subsidized fuel to the intended recipients, the
government has dismissed the problem with unsympathetic words. It
is an act that smacks of irresponsibility.

This is much the same as Pertamina's -- our state oil and gas
firm -- carelessness in distributing kerosene to the poor.

It claims to have unloaded the right amount of kerosene -- in
accordance with the quota set by the government, or even more
than the quota -- to its contractors, who are supposed to
distribute the commodity. Only it has failed to ensure that the
commodity reaches its targets.

The main problem lies in the marked price difference between
subsidized kerosene for the poor and unsubsidized kerosene for
industrial use. Kerosene for the poor is supposed to sell at Rp
700 a liter, but for industries, it is more than 5,000 a liter.

Many tasked with distributing kerosene will be tempted to make
a big profit by selling a sizable quantity of their kerosene to
industries.

The same can be said of diesel fuel. The price of subsidized
diesel fuel, intended for motorists and also fishermen and
farmers, is set at Rp 2,200 a liter, but the price of this
commodity is sold to industries at over Rp 5,000 a liter. It is
no surprise that fisherman are unable to buy diesel fuel to power
their boats.

Such a big price difference is not only bad for the people --
in terms of the fuel scarcity -- but also for the government. The
government's inability to control distribution only exposes
its weaknesses to the people, and that bodes ill for its plan to
increase fuel prices next month.

Moreover, applying different prices for different customers
amounts to discrimination and creates unfairness, especially for
industries, and that is against the antimonopoly law. That is
why, we welcome the move by the Business Competition Supervisory
Commission (KPPU) to investigate this illegal practice.

To solve these problems, it is better for the government to
apply a same-price-for-all policy -- low earners and high flyers,
small-scale businesses and big entities alike. If the government
wants to help people in the low-income bracket,
there are other ways, such as kerosene coupons or direct
subsidies through income supplement.

However, making prices across the board in the domestic market
solves only one of the two main problems we are facing now. The
other major problem is the price disparity between the domestic
and international prices of fuels, which has encouraged those who
have access to subsidized fuel to smuggle it out of the country
for a handsome profit.

To put domestic prices on a par with international ones would
require resolution on behalf of the nation's top leaders, the
President in particular. Does Susilo Bambang Yudhoyono have the
tenacity to do this right now? I don't think so. But, the least
he can do is to gradually adjust our fuel prices so that they are
on the international level.