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People will have to spend more if fuel prices are raised. Photo / Tahiden / Korn Sindo
Arefin Tasrif and Sri Mulyani did not explicitly state that fuel prices will rise as soon as possible. Instead of explaining the plan to increase fuel prices, the two have already opened up about the latest terms regarding the increasingly bloated subsidy budget, the supply of subsidized diesel fuel and special-type fuel allocations.
In her interpretation, Sri Mulyani explained the state of the State Revenue and Expenditure Budget (APBN), particularly the function of subsidies and energy compensation, which has continued to swell. According to Sri Mulyani, the support and compensation budget, which amounted to 502.4 trillion rupees, was not targeted. This figure has also increased from the initial benchmark of 152 trillion rupees in the state budget for 2022. It is not impossible to continue to increase this additional support burden if there are no efforts to reduce consumption of diesel and related fuels.
He revealed that 89% of diesel is enjoyed by companies, while the remaining 11% is enjoyed by families. Of the total family segment, it turns out that 95% are enjoyed by rich families and only 5% by poor families (farmers and fishermen). Meanwhile, for private consumption, the business world enjoys up to 14% and households enjoy the majority, i.e. 86%.
The same thing was reported by Arefin Tasrif when he explained the current situation of fuel subsidies on Friday (26/8) last week. Like his colleagues, Arefin said the burden of fuel subsidies is currently too heavy. The reason is that the global oil price is still above $90 per barrel, which puts pressure on domestic fuel prices. It is known that the current world oil price is still much higher than the price set in the state budget for 2022 at the level of 63 US dollars per barrel.
Under these circumstances, the government is currently manipulating support policies. The more subsidized and earmarked fuel a community consumes, the more budget will be spent to support it.
On the other hand, the government still needs a budget to finance development in a number of sectors. If subsidies are provided continuously but not well targeted, it will be counterproductive to efforts to empower the poor. Moreover, at the same time, the government is also speeding up the construction of the state capital in Kalimantan, which obviously requires a large budget.
Returning to the question of the planned increase in fuel prices, this decision is difficult for the public to accept. In the midst of efforts to restore the economy due to the impact of Covid-19, the decision to increase gasoline prices will be very difficult. Moreover, the public had previously suffered from an increase in the prices of various food items which seemed to be continuing. After cooking oil, chili and meat, now it’s the turn of chicken eggs, whose prices are increasing.
For motor-car users, the news of an increase in fuel prices is, of course, not something they are pleased with. The reason is that they have to go deep into their pockets when refueling.
Given these circumstances, for the government, the increase in fuel prices should be a catalyst in an effort to encourage people to switch over to using public transportation. Of course, this move should be a concern of relevant policy makers for the availability of safe, convenient and affordable public transportation in terms of access and prices.
For the city of Jakarta, providing convenient, accessible and achievable public transportation, although there are still some things that need improvement. However, what about the supporting cities in Jakarta and other cities in the country?
This would, of course, be complicated homework since providing mass transit cannot be done in just a year or two. In addition to the need for adequate political support, there is also a need for continuing education so that mass transit becomes an option for travelers who commute from home to work every day.
(ynt)