JAKARTA - The peak of the corona virus pandemic or COVID-19 in Indonesia is expected to be in April to early May. The government was asked to immediately make future preparations. One of them is preparing an additional budget to overcome the impact of COVID-19 in the economic sector.
Former Deputy Governor of DKI Jakarta, Sandiaga Uno said, COVID-19 cases in Indonesia will continue to increase. The worst scenario and planning, namely 2.5 million people or 1.5 percent of Indonesian people who have contracted the corona.
However, Sandi believes, this can be handled if the community is disciplined in carrying out social distancing. In addition, for people who are in the red zone, it is necessary to carry out a semi-lockdown or partial lockdown.
Sandi said that at this time it was necessary to immediately carry out comprehensive policies for the economic sector in dealing with COVID-19. According to him, a package that is suitable for Indonesia at this time is to prepare the IDR 200 trillion budget needed as a whole, outside of the response to COVID-19 in the health sector.
The economic package can be divided into four stages. First, about 25 percent were carried out direct transfers or referred to as Direct Cash Assistance (BLT) to people in vulnerable groups.
"I support this if out of the Rp200 trillion prepared, a quarter can be directed to use an integrated database aimed at the people in the lowest group, the lowest 40 percent," Sandi said in a video conference with journalists, in Jakarta, Thursday, March 26.
Second, 25 percent of the Rp. 200 trillion in additional budget could be targeted at communities affected by reduced activities. Especially the informal sector, daily workers, and MSMEs.
"This could possibly be touched with around Rp. 50 trillion in economic packages which can be realized in several forms. One of them is ensuring that they continue to operate by providing liquidity packages so that they do not have to lay off workers," he said.
Third, 25 percent or Rp. 50 trillion of the additional budget can be provided in the form of assistance to people who have lost their jobs or have not yet found work. Moreover, the government has prepared a Pre-Work Card program and it must be executed quickly.
Fourth, assistance in the financial sector is also needed at this time. Because many banks and financial finance companies have difficulty paying installments, bills, including electricity and telephone. Thus, 25 percent of the additional budget can be allocated to the financial sector.
"So in terms of the economic package, I am sure this will help. So that if the government has to issue additional new debt or widen the 3 percent deficit, it must be done immediately with bipartisan politics," he explained.
Sandi explained that the execution of this policy cannot be carried out by the government itself, but the government can collaborate with the business world that has the ability to touch the pockets needed for the distribution of this program. The execution can also involve MSME players in all corners of Indonesia.
Source of Budget IDR 200 Trillion
The former chairman of the Indonesian Young Entrepreneurs Association (HIPMI) explained that the source of the additional Rp200 trillion budget could be obtained from the 2020 State Budget reallocation. In addition, the government can also issue debt securities such as those in 1997-1998.
"So we take this Rp200 trillion from the reallocation of budgets that we can comb through in the 2020 State Budget but it won't be enough. We can do that through reallocation but there are other thoughts such as issuing debt securities which are like recap bonds from national banks such as BLBI, "he said.
According to Sandi, currently all stakeholders must sit together to discuss the budget that can be allocated to the four things above. This is because the government must look at the worst and best scenarios for improving the national economy in the midst of the COVID-19 outbreak.
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