Sri Mulyani Is Blunt, The Government Has A Debt Of IDR 84 Trillion To Pertamina For Fuel Subsidies

Minister of Finance Sri Mulyani when visiting Pertamina Hulu Rokan production facilities in RIau (Photo: Instagram @smindrawati)

JAKARTA - Minister of Finance (Menkeu) Sri Mulyani said that the government still has a number of obligations to PT Pertamina (Persero) for subsidized fuel payments. This was explicitly stated by the Minister of Finance when holding a press conference on the realization of the 2022 State Budget earlier this week.

In his explanation, he said that the total government debt to oil and gas companies reached Rp. 84.4 trillion. This amount represents the remaining underpayment obligations until the end of 2021.

Just so you know, this value itself is not the entire subsidy last year, but also the value of the underpayment from the 2020 period.

In detail, in 2020 the government's subsidy obligation to Pertamina is IDR 45.9 trillion. From that figure, only IDR 30 trillion was paid in 2021, so the government still has IDR 15.9 trillion in arrears.

Meanwhile, the value of the fuel subsidy in 2021 alone will total IDR 68.5 trillion. Therefore, the government's total obligation in early 2022 is IDR 84.4 trillion.

“This is what is called a shock absorber. The state budget takes all the pressure that comes from fluctuations in oil prices so that the public does not experience the impact, but the state budget must take the consequences," said the Minister of Finance through a virtual channel quoted Tuesday, 29 March.

On the same occasion, the state treasurer explained that the government would reduce or even begin to eliminate the provision of social assistance (bansos) to the community. Later, the social assistance budget allocation will be shifted to strengthen the energy subsidy post.

This strategy was adopted by the government to anticipate the projected increasing need for funds in line with the soaring prices of various energy commodities in the world.

"So if in 2020, 2021, the domination of the recipients was targeted social assistance which was by name, by address, or by the number of the recipient of assistance, now in 2022 due to the spike in subsidized prices, the social assistance has turned into subsidies in the form of goods, namely fuel, LPG and electricity," said Minister of Finance Sri Mulyani.

To note, the government's debt is not only recorded at Pertamina but also at the State Electricity Company (PLN) amounting to Rp. 24.6 trillion. Thus, the value of the arrears of subsidies that must be repaid by December 31, 2021 is IDR 109 trillion.