The central government has planned to compensate poor citizens with temporary direct cash assistance (BLSM), which many believed would be modeled on 2009's controversial direct cash assistance (BLT).

According to the government's proposal, poor households will get Rp 150,000 (US$15.17) each month for four months, starting immediately after fuel prices are increased.

"I have never favored cash assistance policies. I would rather give the cash to small and medium enterprises or home industries, because this would have a positive impact. I have never agreed to BLT, BLSM and the like," Jokowi told reporters at City Hall on Monday.

He emphasized that the central government's relief program would not be of any help to poor citizens.

"Giving cash assistance would not encourage people to do something to improve their lives. To me, it would be better if we encouraged them to start or develop businesses," he said.

Jokowi, who assumed his post in October, has launched several popular pro-poor policies, including the Kartu Jakarta Sehat healthcare program and Kartu Jakarta Pintar (Jakarta Smart Cards) program to support students from families with low income.

The central government has planned to announce its decision regarding its plan to cut fuel subsidy sometime this week, following the House of Representatives' plenary session on revised state budget on Monday.

The government and the House are currently deliberating the 2013 revised state budget bill during a plenary session. The bill contains a stipulation that raises subsidized fuel price by around 33 percent to Rp 6,500 per liter from Rp 4,500 per liter at present.

In 2013, the fuel subsidy was almost Rp 194 trillion or about 11.5 percent of the state budget. Last year, subsidized fuel consumption exceeded 45 million kiloliters, well over the target of 40 million kiloliters.

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