Celios Economist: Reduction of MBG Operational Days is Not Effective in Saving the Budget
JAKARTA - The Executive Director of the Center of Economics and Law Studies (Celios) Bhima Yudhistira assessed that the plan to reduce the operational days of the Free Nutritious Meal (MBG) program from six days to five days would not provide significant budget savings.
According to him, this step is not the main solution amid potential global crude oil price pressure.
Bhima explained that if the crude oil price remains high in the range of 90-100 US dollars per barrel, then the energy subsidy burden will increase and require a much larger budget allocation.
"So if it can be, the MBG is more targeted, not the working hours or operational hours that are less than one day. But the MBG targets only the 3T areas (behind, ahead, and outermost)," he explained to VOI, Friday, March 27.
In addition, he said that the increase in fuel and LPG prices would also have an impact on the increase in the operating costs of the MBG program, so that the budget of Rp. 335 trillion is considered insufficient if the program is still widely carried out.
"That's why MBG has to be defeated, defeated so that it is shifted for reallocation to energy subsidies," he said.
Bhima also emphasized the need for the government to provide stimulus to maintain people's purchasing power, such as wage subsidy assistance and public transportation subsidies.
He gave an example of a policy in Spain in 2022 during the energy crisis due to the Russia-Ukraine geopolitical crisis which resulted in a sharp rise in crude oil prices, so that the government made public transportation free of charge to encourage a shift from private vehicles to public ones.
According to him, until now the Indonesian government has not issued similar stimulus due to budget constraints.
"Well, there is no policy in Indonesia either, there is none. So there are many stimuli that have not been launched by the government due to budget constraints," he said.
In fact, according to him, the MBG program has the potential to add to the burden of the budget deficit and logistics costs.
Therefore, Bhima encourages the reduction and refocusing of the MBG program budget so that it can be diverted to energy subsidies and other needs, including funding for energy transition which also requires a large budget.
"I think there must be a reduction in the MBG program in refocusing. That will only widen the fiscal space so that it can be used for other needs. So MBG should be able to save Rp. 300 trillion for 2026 because the same figure for additional energy subsidies is possible," he said.
"Well, there is still a policy that should be encouraged faster, it needs a large budget, for example for energy transition, to encourage the fuel to be reduced, the energy transition is increased, 100 gigawatt also needs a not small budget," he added.
He emphasized that reducing operational days is not the main solution, but rather a significant reallocation of the budget is needed to strengthen the government's fiscal space.