Whoops! Elpiji Subsidy Budget Reduced by IDR 17 Trillion Next Year, Will Gas Prices Increase?

JAKARTA - The Ministry of Finance (Kemenkeu) stated that the government has budgeted Rp. 117.4 trillion for subsidies for 3 Kg LPG cylinders in the 2023 State Budget Draft Law (RUU).

Head of the Fiscal Policy Agency (BKF) of the Ministry of Finance Febrio Kacaribu said the budget would be allocated for 8 million metric tons of gas next year.

"The 3 kg LPG subsidy budget in 2023 is planned at Rp. 117.4 trillion", he said while attending a working meeting with Commission XI of the DPR at the Senayan Parliament Complex, Jakarta, Monday, September 12.

From Febrio's presentation, it is known that this value decreased by around Rp. 17.3 trillion from the amount of subsidized LPG in 2022 which amounted to Rp. 134.7 trillion by Presidential Regulation 98 of 2022. Meanwhile, the outlook for LPG subsidies this year is estimated to be only Rp. 129.7 trillion.

Sri Mulyani's subordinate emphasized that the government is committed to implementing a more targeted distribution scheme for this energy commodity. The reason is, that the scheme used now is open so that everyone can access 3 Kg LPG on a massive scale.

"The government will optimize the distribution of subsidized LPG by integrating the basic food card social assistance", he said.

In addition, the strengthening of distribution in the field will be further enhanced in 2023 by strengthening the digital data system.

"The transformation of the 3 Kg LPG subsidy will be carried out in stages by taking into account the condition of economic recovery and the readiness of the database and people's purchasing power", said Febrio.