World Oil Prices Rise, Banggar DPR Approves State Budget 2022 To IDR 3.106 Trillion

Chairman of the Banggar DPR Said Abdullah and Minister of Finance Sri Mulyani at the DPR building, Thursday, 19 May/PHOTO: NAILIN IN SAROH-VOI

JAKARTA - The House of Representatives of Budget Agency (Banggar) has approved the government's proposal regarding the revision of state spending in the 2022 State Budget to IDR 3,106 trillion.

This approval was decided at the Banggar Working Meeting with the Minister of Finance, Sri Mulyani Indrawati at the House of Representatives Building, Senayan Jakarta, Thursday, May 19.

"The change has consequences for changes in overall expenditure posts, the government's proposal for state expenditures is around IDR 3,106 trillion", said Chairman of the Banggar House of Representatives, Said Abdullah.

According to Said, the change in the state budget posture is influenced by the increase in world crude oil prices so energy subsidies are also increasing.

"The increase in the price of crude oil makes subsidies have to be increased to IDR 74.9 trillion with details, subsidies for fuel and LPG of IDR 71.8 trillion, and electricity subsidies of IDR 3.1 trillion", he explained.

Said explained that the changes that occurred included the Indonesian Crude Price (ICP) which was previously assumed to be USD 63 per barrel to USD 100 per barrel. So that the state income changed from IDR 1,846.1 trillion to IDR 2,266.2 trillion.

"State spending has changed from IDR 2,714.2 trillion to IDR 3,106.4 trillion", he said.

On the other hand, added Said, the allocation for social protection has also increased, so the government also needs to increase the budget allocation for social protection by IDR 18.6 trillion. Thus, education spending that is proclaimed for 20 percent of the total APBN will increase in the range of IDR 23.9 trillion.

"The addition of several expenditure posts above also has the consequence of absorbing an additional reduction in SAL of IDR 50 trillion", said the chairman of the PDIP DPP.

However, Said said, the increase in state spending was also accompanied by an increase in state income. The government estimates that state revenues will increase to IDR 2,266 trillion from the initial Rp1,846 trillion, or an increase of around IDR 420 trillion.

According to Said, the increase in state revenue was contributed by tax revenues, non-tax revenues, or increases in various leading export commodities such as CPO and coal. With the change in the composition of the budget, the budget deficit throughout 2022 is expected to be low, from 4.89 percent of GDP to 4.3-4.5 percent of GDP.

"The lower deficit planning will make it easier for the government too soft landing to a position (deficit) below 3 percent in 2023", he concluded.