Coordinating Minister Airlangga: Naughty Local Government Plays Regional Inflation Data Must Be Sanctioned

Coordinating Minister for Economic Affairs (Menko) Airlangga Hartarto. (Photo: Doc. ANTARA)

Coordinating Minister for Economic Affairs Airlangga Hartarto said that local governments (Pemda) who manipulate inflation rates in order to get incentives from the central government will be sanctioned.

"(The local government) who is naughty must be given sanctions," he explained to reporters, Friday, October 4.

According to Airlangga, the provision of incentives to local governments to control volatile food in their respective regions is so that people's purchasing power is not eroded due to rising food prices.

"We provide incentives so that they control volatile food. Volatile food is important, so that people's purchasing power doesn't get eroded because food prices go up," he said.

Previously, Minister of Finance Sri Mulyani Indrawati said that she had met with the Minister of Home Affairs of the Republic of Indonesia Tito Karnavian and there were some wrong inflation data and corrections had been made.

"I have checked with Mr. Tito, the Minister of Home Affairs. He said there were several but there were very few and corrections have been made," he explained to reporters, Friday, October 4.

Sri Mulyani emphasized once again that inflation data must be accurate and credible because the central government provides rewards to local governments so that these rewards do not create an attitude or action that actually distorts or changes the inflation rate.

Therefore, Sri Mulyani admitted that she had agreed with Tito Karnavian and all of them so that BPS could keep the inflation rate accurate and credible.

"For rewards, they must really come from achievements because prices are stable and good," he said.

Head of the Fiscal Policy Agency (BKF) of the Ministry of Finance, Febrio Nathan Kacaribu, explained that there is an opportunity to withdraw the provision of inflation incentives if it is proven that the regions are manipulating inflation data.

"We'll see (revocation of incentives) later, yes," he explained.