Apologizing About Pertamax Prices Go Up, Erick Thohir Makes Sure Pertalite Can Still Get Subsidies

SOE Minister Erick Thohir together with the management of PT Pertamina (Persero). (Photo: Doc. Antara)

JAKARTA - Minister of State-Owned Enterprises (BUMN) Erick Thohir said that in conditions of economic growth that had not fully returned to the way it was before the COVID-19 pandemic, the government could not only rely on income from taxes. Therefore, state-owned companies must pay dividends to the state.

Furthermore, Erick explained that the dividends obtained by the state from state-owned companies became the budget used to provide subsidies to the public. One of them is the Pertalite type of fuel oil subsidy. But not with Pertamax type BBM.

As is known, the government has decided that there will be no increase in the BMM price for the Pertalite type. Even though world crude oil prices have surged to penetrate 108 US dollars per barrel.

"It's impossible in economic conditions like today the government only relies on taxes, finally there needs to be dividends. This dividend which is used for the fuel subsidy program is still running, yes, the government has decided that Pertalite will be used as a subsidy, not Pertamax. So if Pertamax goes up, I'm sorry, but Pertalite is still subsidized," he said while giving a public lecture at Hasanudin University Makassar, Wednesday, March 30.

Erick explained that the state must spend very deep to provide fuel subsidies to the community. In fact, the number reaches trillions of rupiah. This includes electricity subsidies for 450 VA customers.

"But that is the government's policy where fuel subsidies reach tens of trillions. Yesterday, 450 electricity was free of social assistance and others. So the government is here," he explained.

As previously reported, the Special Staff to the Minister of SOEs, Arya Sinulingga, also suggested Pertamina to recalculate the price of Pertamax. Because, based on information from the Ministry of Energy and Mineral Resources, RON 92 or Pertamax, the economic price is IDR 14,500 per liter.

Meanwhile, Arya said, Pertamina is still selling it at a price of IDR 9,500. He also admitted that he was worried that the government would subsidize Pertamax fuel for luxury car users.

"Pertamax is IDR 9,500, it can be said that Pertamina is subsidizing Pertamax. And this clearly means, Pertamina is subsidizing luxury cars that use Pertamax. This needs to be recalculated so that there is justice," he said.

Furthermore, Arya said the current number of Pertamax is 13 percent of the fuel consumption in Indonesia and in general are luxury cars. Therefore, it is necessary to recalculate the price of Pertamax.

"It's time to recalculate what a decent price is given by Pertamina for the price of Pertamax consumed by luxury cars. This is for all justice," he said.

Arya said that in Southeast Asian countries, Pertamax fuel is priced between IDR 14,000 to IDR 15,000 per liter. Even if in Malaysia the price of Pertamax could be lower, this is because the local government allocates Pertamax subsidies with a certain mechanism.

"So now it's enough, we should repeat it, don't let Pertamina subsidize luxury cars that use Pertamax," he said.

Jokowi alludes to the difficulty of rising fuel prices

President Joko Widodo (Jokowi) has also mentioned the increase in world crude oil prices which rose to 118 dollars per barrel. As a result, the price of fuel oil (BBM) in countries that do not provide subsidies has doubled or 100 percent.

As is known, Indonesia still maintains the price for subsidized fuel. This means that the price of fuel is not corrected even though the world crude oil price is soaring.

According to Jokowi, in Indonesia, when the government wanted to increase fuel prices by 10 percent, even far from the increase in oil prices in other countries, it was met with opposition in the form of demonstrations for three months.

"Countries that do not subsidize their fuel prices directly double. Imagine that we only increase by 10 percent in 3 months. This double means that it is a 100 percent increase," he said in a briefing on the proud affirmation action made in Indonesia broadcast on the YouTube channel. Presidential Secretariat, Friday, March 25.

For your information, Indonesia as an importer of world crude oil every year must subsidize the selling price to the public. Throughout 2021, energy subsidies will reach IDR 131.5 trillion. Soared from 2020 which amounted to IDR 110.5 trillion. Meanwhile, in 2022, energy subsidies in the first month have penetrated IDR 10.2 trillion, or jumped 347.2 percent from January 2021.