Subsidized Fuel Will Be Limited Starting August 17, Erick Thohir: Don't Let People Can Use It

JAKARTA - Minister of State-Owned Enterprises (BUMN) Erick Thohir said the government continues to encourage the distribution of subsidized fuel to be right on target. This means that this fuel is really used by people who can't afford it, not the rich.

The statement also responded to the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan who said that the purchase of subsidized fuel oil (BBM) would be limited starting August 17, 2024.

"Don't let this fuel (subsidy) be used by people who can afford it, but those who are entitled to subsidized fuel," he said when met by the Kota Tua area, Jakarta, Wednesday, July 10.

Currently, continued Erick, the government is processing the revision of Presidential Regulation (Perpres) Number 191 of 2014 concerning the Provision, Distribution and Retail Selling Price of fuel.

Erick also hopes that the regulation that regulates the subsidized fuel restrictions can be accelerated. Including, said Erick, the regulation of restrictions on subsidized LPG purchases is enforced.

"We really support Presidential Decree 191 to be encouraged immediately. Not only for fuel, but we hope to also make gas, because LPG imports are very high now. And this is what we have to fix, don't let subsidies get the target wrong," he explained.

Erick also said that Pertamina as a state-owned company assigned to distribute subsidized energy will certainly follow the policies set by the government.

"So I'll just have to wait (Perpres 191 is completed), because there must be a policy. Remember, you know, that SOEs are corporations, not policy makers," he explained.

Previously, it was reported that the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan revealed that the government is targeting tightening the use of subsidies on August 17, 2024. With this step. Luhut said that it can reduce the number of subsidies distributed to people who are not entitled and regulate so that subsidies are more targeted.

Giving inappropriate subsidies (targets). That's now Pertamina has prepared. We hope that on August 17, we can start, where people who are not entitled to subsidies will be able to reduce them. We will count there," said Luhut through his official Instagram @luhut.panjaitan quoted Wednesday, July 10.

Luhut added that in addition to carrying out efficiency by tightening subsidized recipients, Luhut also said that the government plans to encourage alternative replacements for gasoline through bioethenol.

Luhut assessed that this step could suppress imports of fuel and reduce levels of air pollution. Moreover, the sulfur level owned by this alternative fuel is also relatively low.

By reducing sulfur levels, he said, the number of ISPA sufferers could be suppressed and BPJS payments for the disease could save the state budget.

"We are now planning to encourage bioethenol to enter to replace gasoline so that this air pollution can also be reduced quickly because sulfur is almost 500 ppm, right," he said.

Meanwhile, Luhut continued, this plan is being worked on together with PT Pertamina (Persero).

"Now this is being worked on by Pertamina. Now, if everything goes well from there, I think we can save more," concluded Luhut.