Managing the state budget without fiscal discipline could be dangerous, Kadin said.
he business community has asked the incoming government under president-elect Prabowo Subianto to maintain fiscal discipline, especially if it aims to expand the state budget deficit to accommodate more spending.
Experts have suggested that the Prabowo administration might create a higher deficit to accommodate his campaign promises and plans, exceeding the limit of 3 percent of gross domestic product set by law, a threshold that has long acted to maintain fiscal prudence.
Indonesia has never exceeded the cap since the law was enacted in 2003, except during the COVID-19 pandemic.
“Discipline is key, yes, even if the deficit is to be widened, its usage must be clear and disciplined,” Indonesian Employer Association (Apindo) chairwoman Shinta Kamdani said in Jakarta on April 10, as quoted by Kumparan.
Apindo has prepared documents containing inputs from various sectors for the next government, particularly for each minister in the upcoming administration, Shinta said, highlighting continuity in the next cabinet.
Indonesian Chamber of Commerce and Industry (Kadin) chairman Arsjad Rasjid concurred, stating on the same occasion that “[The new government] must be disciplined, if not, it’s dangerous.”
One of the centerpieces of Prabowo’s campaign was a planned free school lunch program that is projected to cost Rp 400 trillion (US$30 billion) per year, equivalent to 12 percent of this year’s state budget spending and around 2 percent of the country’s GDP.
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