Pertamax Price Hike Must Be Accompanied by Cash Social Assistance, Says Economist

The government must promptly prepare a targeted direct cash assistance (BLT) programme to cushion the impact of the recent non-subsidised fuel price hike on vulnerable communities, according to Trimegah Sekuritas Indonesia Chief Economist Fakhrul Fulvian.

Fulvian stated that the decision to raise the price of Pertamax (RON 92) by more than 30 percent was a difficult but unavoidable step given the current fiscal conditions, rising global energy costs, and pressure on the rupiah exchange rate. “The most important thing now is to ensure that the affected public does not bear the entire burden of this adjustment,” he said in Jakarta on Thursday (11/6).

He stressed that the speed of implementation is critical, recommending that cash transfers be distributed immediately after the price increase takes effect to prevent a deep decline in household consumption. Fulvian suggested leveraging digital technology, including integrated population data, digital payment systems, banking infrastructure, and artificial intelligence, to ensure accurate and rapid distribution of the social assistance.

Beyond immediate relief, Fulvian emphasised that the policy’s long-term success depends on the government’s willingness to evaluate and reorganise state spending. He specifically highlighted the need for efficiency in strategic programmes, such as the free nutritious meals initiative (MBG), to ensure they remain sustainable without excessively burdening the state budget. “The government must demonstrate that fiscal discipline, social protection, and spending reform can go hand in hand,” he asserted, adding that achieving this balance would lay a stronger economic foundation, maintain exchange rate stability, and support sustainable growth for Indonesia.