Costly satellite technology coupled with the high potential for public unrest has led the government rethink the "Smart Card" program to limit motorists' purchase of subsidized fuels.
Despite all the publicity on the claimed effectiveness of the system, Energy and Mineral Resources Minister Purnomo Yusgiantoro on Wednesday put the breaks on the plan.
Purnomo, having recently been criticized for mismanaging the country's energy sector, said there would be greater financial burden on the government should the plan be launched without a comprehensive study.
"We are now studying the Smart Card (program) once again. We need to study the financing of the program because it will be expensive, especially when it involves satellite technology," said Purnomo during a hearing with the House of Representatives' energy commission late Wednesday.
According to Purnomo, satellite technology is required because the downstream oil and gas regulator BPH Migas will need an interlinked system which can help the regulator supervise around 2,000 gas stations in Java and Bali.
The agency is responsible for implementing the program.
Purnomo said the Smart Card system had so far received negative responses from the public in Bali and Batam where a trial run was recently launched.
"It's also impossible to do it in Jakarta as the market here is more complicated. We will review the plan," he said.
Purnomo's statements contradicted his earlier optimism during a similar hearing two months ago when he boasted the program would take effect early January next year.
At the previous hearing, Purnomo said the government would start the bidding process for the procurement of the technology in June and start the distribution of the Smart Cards to the public from Sept. 31 to Dec. 31.
He did not mention anything about satellite technology.
The Smart Card program was proposed earlier this year to reduce fuel consumption and save on fuel subsidies, which are expected to soar to Rp 132.1 trillion (US$14.3 billion) from the 2008 state budget's allocation of Rp 126 trillion.
The Smart Card, which keeps track of the amount of subsidized fuel an individual purchases, would be distributed to motorists and public transportation operators.
Users would be required to show the cards every time they purchased subsidized fuels.
Previously, BPH Migas chairman Tubagus Haryono said the Finance Ministry had allocated a budget of Rp 300 billion for the implementation of the program.
Energy analyst Pri Agung Rakhmanto recommended the government use smarter and more efficient strategies in trying to limit public fuel consumption by issuing a regulation giving certain groups of motorists priority in buying subsidized fuels.
"Just issue a clean-cut regulation saying only certain groups of people can buy subsidized fuels, while the others cannot. The government must be strict in implementing such a rule," he said.
| 
|
|
|
|
|
|
|