Car owners agree cheap fuel is more reasonable

As the government and the House of Representatives are working out the details of a new policy to limit the sale of subsidized fuel, many car owners in the city are up in arms over the plan.

Dewi Anjani, a college student, told The Jakarta Post while refueling her Japanese limited edition car that if the government pressed ahead with its plan she would likely end up spending more money on gas.

“I am just a student and having to buy the non-subsidized fuel means I have to spend more money,”
she said.

Her fellow student, Vincencius Edwin, agreed with Dewi, saying he would likely cut back on his spending on other things to compensate.

“I have two cars, one was built before 2005 and the other after 2005. But once the plan is enacted I
will spend double my current fuel expense.

“Now I spend between Rp 200,000 [US$22] and Rp 300,000 on fuel per week,” Edwin said.

Currently, Edwin spends Rp 1.2 million a month on fuel. He exclusively buys subsidized gasoline labelled “Premium” by state-owned oil and gas firm PT Pertamina.

Parents-dependent students are not the only ones likely to suffer from the new policy.

An employee of a private company, Sugianto, said he blamed corruption in the government for the new policy.

“They could not effectively manage the money from taxes because there are so many leaks in the bureaucracy.

“With the proper management of the tax money, not only could the government spend more on the poor, they could also pay the subsidy for our fuel,” he said.

Sugianto said he could double his spending on fuel should the plan materialize. “I now spend Rp 1 million per month on fuel. I could end up spending double that amount so I totally disagree with the plan,” he told the Post.

The government has said it is ready to implement the plan, but it is not clear whether the government has sufficiently prepared to be able to implement the plan by Jan. 1.

Upstream Oil and Gas Regulatory Agency (BPH Migas) has prepared two options to carry out the plan, which is designed to cut the massive budget spending on subsidized fuel.

The first option would allow public transportation vehicles, motorcycles and fishermen only to buy subsidized fuel, and the second would also allow vehicles manufactured in or before 2005 to buy the fuel.

PT Pertamina said it was ready to stop selling Premium to all private cars in Greater Jakarta starting next January, a plan it says will cut Premium fuel consumption by 500,000 kiloliters per year.

Some consumers believe a more appropriate policy would be simply to increase fuel prices.

Bobby Primasta told the Post while refueling his new sports car that the plan was ill-advised as it left him with no option but to buy non-subsidized fuel.

“I think raising the price of Premium would be a good idea rather than limiting it,” he said.

“I would rather incur a Rp 500 increase per liter than see my fuel expenditure double.” (map)