PHRI Hopes That The Government Will Take Strategic Steps Soon In The Hospitality Industry Sector

PHRI chairman Hariyadi Sukamdani (Photo: Doc. VOI)

JAKARTA - The budget efficiency measures implemented by the government in recent years have had a significant impact on various sectors, including the hotel industry. Policy on limiting official travel, reducing budgets for government events in hotels, and optimizing the use of virtual meetings is part of a savings strategy that has a direct impact on hotel occupancy and income levels, especially in cities that have been dependent on government agency activities.

Hotel business players are starting to feel pressure due to declining service requests, especially from government agencies, corporate segments, and public agencies. Hotels that had previously become activity subscriptions such as seminars, training, and meetings now have to find new strategies to fill the void.

According to the data collected, the average occupancy rate of hotels in Jakarta is around 30-40 percent after the government's budget efficiency which has the potential to terminate employment (PHK) for hotel employees. Meanwhile, in 2024 hotel occupancy can reach 80-90 percent.

Although budget efficiency is part of a healthier state financial management effort, the hotel sector is required to adapt quickly to survive in the midst of changing consumption patterns.

Chairman of the Indonesian Hotel and Restaurant Association (PHRI), Hariyadi BS Sukamdani, asked the government to be more serious in responding to this problem. According to him, the government's budget efficiency policy has not only had an impact on the hotel business, but also on other industrial sectors. Even now there is a decrease in people's purchasing power in general.

This is not just a matter of hotels. They use hotels because there are needs such as socialization or meetings with the community. If the activity is not carried out because the budget is not there, how can it run? Invite the speaker, for example, of course there is a fee. So in my opinion, it is not only hotels that feel aggrieved, but the wider community is also affected. As a result, people's purchasing power has also decreased," Hariyadi explained to VOI by telephone, Friday, May 30, 2025.

He also explained that legal accommodation service actors are currently looking for alternative solutions, with the tourism sector being one of the mainstays to support business. However, the rise of illegal accommodation services is a separate obstacle. Foreign tourists tend to choose to stay in illegal villas and homestays, rather than hotels.

"We have the potential of foreign tourists, but the government doesn't seem to be serious in their efforts to bring them in. From the information I received, the budget in the relevant minima or even unavailable for promotion," he said. He gave an example of conditions in Bali, where the proliferation of illegal villas and homestays caused a decrease in hotel occupancy rates. Foreign tourists prefer illegal accommodation services as temporary residences during holidays.

The illegal villa had a major impact on hotels and legal accommodation. The request was absorbed there. I also have not seen any serious efforts from the Bali local government to overcome this," he added.

Hariyadi hopes that the government will immediately accelerate the execution of budget policies. Although currently there has been an easing in several government institutions to hold activities at hotels, the implementation is still not significant.

"It is better if the priority has been determined, it will be executed immediately. Don't delay it. The point is, activities can run if the budget is available. Yesterday the budget was nil, so hotel activities cannot be carried out. Now it is gradually relaxed, but in the field for May there are still a few. We don't know yet how conditions are in June," he concluded.