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Electricity subsidy to be revised to ease high fiscal risk
Based on the 2018 central government financial report, the government disbursed Rp 56.5 trillion (US$3.98 billion) for the electricity subsidy.
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The Finance Ministry's fiscal policy head, Suahasil Nazara. (kompas.com/ Ahmad Fauzi )
T
he government is seeking a more appropriate electricity subsidy scheme because the current one is deemed to carry high fiscal risk, an official says.
The Finance Ministry’s fiscal policy head, Suahasil Nazara, said on Tuesday that under the current electricity subsidy policy that had been implemented since 2016, the funds disbursed for the subsidy had always exceeded the amount allocated in the state budget.
The new scheme was expected to be implemented next year.
“It [the subsidy] is of course for the interest of the people, but on the other hand, there is high risk for state financial [sustainability],” Suahasil said during a meeting with the House of Representatives’ budget committee in Jakarta on Tuesday.
Based on the 2018 central government financial report, the government disbursed Rp 56.5 trillion (US$3.98 billion) for the electricity subsidy.
He said the government had evaluated the customers of state-owned electricity company PLN with 900 VA electricity supply to make sure deserving households received the subsidy.
“The policy guidance in the future is to reduce compensation that will affect the state-owned enterprise (PLN) [...],” he added. (bbn)
