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Jakarta Post

Govt spends 19% of COVID-19 rescue package, plans more electricity subsidy

  • Dzulfiqar Fathur Rahman

    The Jakarta Post

Jakarta   /   Mon, July 27, 2020   /   06:21 pm
Govt spends 19% of COVID-19 rescue package, plans more electricity subsidy Bagged up: A recipient shows off free rice taken from the ATM Pertanian Sikomandan (Agriculture Commander ATM) at South Jakarta Military District Command. The government, through the Agriculture Ministry, is distributing free rice to help people badly affected by the COVID-19 outbreak in Greater Jakarta. (JP/Dhoni Setiawan)

The government has so far spent almost a fifth of its stimulus budget to contain the health and economic effects of the pandemic as President Joko “Jokowi” Widodo calls for acceleration of the national economic recovery program.

Budi Gunadi Sadikin, the head of the national economic recovery task force, said Monday Indonesia had spent 19 percent of the Rp 695.2 trillion (US$41.8 billion) as of July 22.

For social assistance, the government has spent 38 percent of the allocation. It has also spent 13 percent of the allocation for business incentives and 6.5 percent of the allocation for government ministries and agencies.

“The President ordered us to speed up the spending of the national economic recovery program that the government had arranged,” Budi said in a virtual presser on Monday.

The government is trying to accelerate the disbursement of the coronavirus rescue package to keep up with the pandemic. The slow disbursement prompted President Joko “Jokowi” Widodo to strike a more urgent tone in pushing his ministers.

Read also: Jokowi ‘upset’ over ministers’ lack of sense of urgency in COVID-19 response

The COVID-19 pandemic has slowed Indonesia’s economic growth to just 2.97 percent year-on-year in the first three months of 2020. The government expects the country to fall into recession in the third quarter.

In hopes to better handle the crisis, the government formed a new team, called the National Economic Recovery and COVID-19 Response Team, which integrates the decision-making process on economic and public health fronts.

Coordinating Economic Minister Airlangga Hartarto, who heads the team, said Monday the government was planning to allocate an additional Rp 3 trillion for electricity subsidy for customers in the social, corporate and manufacturing sectors to pay their minimum bills.

“In addition to the electricity subsidy for low-income families that we will extend through December, we agreed earlier today on a subsidy to ease the minimum payment that industries and tourist companies have been asking for,” said Airlangga.

Without the subsidy, social, corporate and manufacturer customers will have to pay a minimum of Rp 5.6 trillion for the second half of the year. Meanwhile, their actual electricity consumption costs less than half of it.\

Read also: Over a million low-income households left out of electricity relief scheme

As many as 112,223 customers in the social sector, 330,653 companies and 28,886 manufacturers will get the subsidy.

Previously, the government decided to extend until September the electricity subsidy for customers subscribing to State-Owned Electricity Company’s (PLN) 450 volt amperes (VA) and 900 VA schemes.