Palace Explanation on the Proposal to Cut Officials' Salaries

The government has responded to the proposal for salary cuts for civil servants (ASN) as one option for budget efficiency amid global pressures. This step is being studied as an effort to maintain the health of the state budget (APBN) without sacrificing priority programmes. The rise in fuel prices is prompting the government to seek additional fiscal space, rather than cutting fuel and electricity subsidies or priority programmes such as Free Nutritious Meals (MBG). One measure under consideration is budget efficiency in ministries and agencies, including the option of reducing state officials’ salaries. President Prabowo Subianto has asked his team to study this step in depth. State Secretary Prasetyo Hadi stated that the study on salary cuts for officials is still being detailed. “We are detailing the study, because whatever happens, although in terms of fuel supply we do not need to worry because the stock is safe,” Prasetyo said, quoted on Wednesday (18/3/2026). He explained that the government does not actually need to worry about fuel supply because the stock is in safe condition. However, he believes that anticipatory steps are still necessary to maintain fiscal health. Prasetyo views the President’s directive as a reasonable action in such a situation. He added that budget savings should start from within the government, both ministries and agencies. He also gave examples of efficiency measures that can be taken, such as reducing fuel consumption by switching to public transport and limiting the use of official vehicles. These efforts are seen as able to help reduce the burden on the state budget. Furthermore, Prasetyo emphasised that budget efficiency should not only be done during crises. According to him, even in normal conditions, the government still needs to maintain spending discipline. Meanwhile, Finance Minister Purbaya Yudhi Sadewa also responded to the proposal for salary cuts for officials. He implied that the policy would not be a problem, even assessing that the current salary levels for officials are already quite large, so it is still possible to reduce them.