TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Bansos not affected by budget cut, says Sri Mulyani
Finance Minister Sri Mulyani Indrawati said that social assistance (bansos) funding would remain untouched despite the government's budget efficiency measures to support President Prabowo Subianto’s flagship free meals program, among others.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Meeting daily needs: A social aid recipient receives a sack of rice from the government's food reserves distribution program at Dumai Post Office in Riau, on Oct. 29, 2024. The post office is slated to disburse 10 kilograms of rice to nearly 15,000 families registered as social aid recipients in Dumai in August, October and December. (Antara/Aswaddy Hamid )
F
inance Minister Sri Mulyani Indrawati said that social assistance (bansos) funding would remain untouched despite the government's budget efficiency measures to support President Prabowo Subianto’s flagship free meals program and other costly initiatives.
"The social assistance budget will not be cut at all. There is no reduction whatsoever," she said at an event in Jakarta on Thursday, as quoted by Kompas.com.
The social assistance budget is estimated to be between Rp 1 trillion (US$61 million) and Rp 1.3 trillion in 2025, with final adjustments depending on the President's instructions.
"That said, there will be no reductions in social assistance or other programs essential to public welfare," Sri Mulyani said.
President Prabowo has ordered ministries, agencies and regional leaders to cut a combined Rp 306.7 trillion in spending this year, as stipulated in Presidential Instruction No. 1/2025 issued on Wednesday.
The directive is expected to affect spending related to official travel, ceremonies and consultancy services, among other areas, with exemptions including employee salaries and social assistance programs.
Read also: Govt slashes ministerial, regional spendings to finance welfare programs
Sri Mulyani said the move would instead boost economic growth as the funds would be reallocated to initiatives that directly improve the people’s welfare, such as the free meals program, food and energy self-sufficiency and health care.
The Finance Ministry has so far allocated over Rp 3.6 trillion for Prabowo's priority programs.
"We are currently making further adjustments to refine budget reallocations across ministries and agencies as instructed by the President," the minister said.
Reyhan Noor, a senior political economy analyst from Laboratorium Indonesia 2045 (LAB 45), said the spending cuts could create up to 9.96 percent in additional fiscal space within the 2025 state budget.
To make sure the savings do not negatively impact the economy, the government is urged to be strategic in offering tax incentives.
"Another alternative to increasing fiscal capacity is evaluating the effectiveness of government-covered tax incentives. For example, reviewing tax holidays and allowances to reassess the benefits of these policies," said Rayhan.
