THE Indonesian government is currently designing and implementing a new scheme for fuel oil (BBM) subsidies to ensure that this assistance is more targeted and reduces waste that has occurred so far.
In this new scheme, fuel subsidies will no longer be given evenly, but will be more focused on certain groups of people and sectors that really need them.
The new fuel subsidy scheme aims to ease the burden on low-income communities and optimize the use of subsidy funds for productive sectors.
This step was taken because previously it was felt that fuel subsidies were not on target and there was potential for abuse by groups who did not need the assistance.
Therefore, the government through the Ministry of Energy and Mineral Resources (ESDM) and the Ministry of Social Affairs (Kemensos) is introducing a more measurable mechanism.
The following are several categories of fuel subsidy recipients based on the new scheme that will be implemented:
1. Poor and Vulnerable Communities
The government will prioritize providing fuel subsidies to the people registered in Integrated Social Welfare Data (DTKS). This group consists of poor families who have low incomes and are vulnerable to poverty. Distribution of subsidies to them is expected to help them reduce their burden of expenses, especially in transportation and household energy costs.
2. Micro, Small and Medium Enterprises (MSME) Group
MSMEs are a sector that is very vulnerable to fluctuations in energy prices, especially fuel. Therefore, this business group will receive more attention in the new subsidy scheme. The government hopes that by providing subsidies to MSMEs, small businesses can maintain the continuity of their businesses without having to be burdened with high energy costs.
3. Public Transportation
Public transportation such as buses, public transportation and motorbike taxis are often people’s mainstay in daily mobility. With more focused fuel subsidies, it is hoped that public transportation costs will be more affordable. This will certainly have a positive impact on people who depend on public transportation for their activities.
4. Farmers and Fishermen
Farmer and fisherman groups who need fuel for agricultural and fisheries operations will also be the main recipients of this subsidy. Many farmers use fuel to operate agricultural machinery, while fishermen need fuel for boats and fishing gear. With subsidies, it is hoped that agricultural and fishery products will be more affordable and improve the welfare of farmers and fishermen.
5. Specific Industries
Certain industrial sectors, such as those involved in food security, production of basic commodities, and other sectors that support people’s basic needs, will also receive fuel subsidies. The government considers these sectors to be very important for the continuity of the national economy, so that the subsidies provided can increase competitiveness and reduce production costs.
Use of Technology for Distribution of Subsidies
The government also plans to use technology to optimize the distribution of fuel subsidies. One of the proposed mechanisms is to use special applications and cards that make it easier to monitor subsidy recipients.
Through this system, the government can more easily verify who is entitled to receive subsidies and avoid potential abuse that has often occurred in the past.
In addition, quota restrictions for each type of fuel will also be implemented to ensure that only those who are entitled to subsidies receive them. In this way, it is hoped that there will be no more misuse or waste of subsidies that are not well targeted.
The implementation of the new fuel subsidy scheme certainly faces challenges, especially in terms of verifying accurate recipient data and transparency in distribution.
However, if implemented well, this scheme is expected to increase the efficiency of using the subsidy budget and provide greater benefits for people in need.
The government hopes that with well-targeted subsidies, sectors that depend on fuel can continue to run at more affordable costs, while poor people will no longer be burdened by ever-increasing fuel prices. (Z-10)
Source:
- Ministry of Energy and Mineral Resources (ESDM). (2024). New Fuel Subsidy Scheme and Its Distribution. Jakarta: Ministry of Energy and Mineral Resources.
- Ministry of Social Affairs (Kemensos). (2024). Integrated Social Welfare Data (DTKS). Jakarta: Ministry of Social Affairs.
#Fuel #Subsidy #Scheme #Recipients #Considered #Targeted
How does the Indonesian government plan to ensure that subsidies reach those in remote areas under the new scheme?
## Interview with Expert on Indonesia’s New Fuel Subsidy Scheme
**Host:** Welcome to the show. Today we’re discussing the Indonesian government’s new fuel subsidy scheme with Dr. [Guest Name], an expert in energy economics. Dr. [Guest Name], thanks for joining us.
**Dr. [Guest Name]:** Thank you for having me.
**Host:** The government has announced a new, more targeted approach to fuel subsidies. What prompted this change?
**Dr. [Guest Name]:** As reported by media outlets like Media Indonesia [1], the previous system was criticized for being inefficient and susceptible to abuse. Subsidies were not reaching those in greatest need, and there were concerns about waste and potential misuse.
**Host:** Can you tell us about the new scheme? Who will benefit?
**Dr. [Guest Name]:** Sure. The new scheme will prioritize five key groups. Firstly, the poorest and most vulnerable communities identified through the Integrated Social Welfare Data (DTKS) will receive direct support. Secondly, micro, small and medium enterprises (MSMEs) will be targeted to help them cope with fluctuating energy costs.
Thirdly, the scheme will address public transportation, aiming to make bus fares and motorbike taxis more affordable.
Fourthly, farmers and fishermen will get assistance to help them operate machinery and boats, keeping food prices stable and supporting their livelihoods.
specific industries crucial for food security and basic commodities production will receive subsidies to enhance competitiveness and lower production costs.
**Host:** This sounds like a more targeted approach. Are there concerns about reaching people in remote areas?
**Dr. [Guest Name]:** Yes, that’s been a concern traditionally. However, the government plans to explore new technologies to ensure efficient and equitable distribution. This [1] article mentioned the use of digital platforms and mobile technology for targeting beneficiaries and managing disbursements.
**Host:** That’s encouraging. Do you think this new scheme will be successful in achieving its objectives?
**Dr. [Guest Name]:** It’s certainly a step in the right direction.
The focus on targeted assistance and the potential use of technology are promising developments. These could help ensure that subsidies reach those who need them most, minimize waste, and ultimately contribute to a more sustainable and equitable energy policy. However, successful implementation will depend on careful planning, effective oversight, and constant evaluation to address any challenges that arise.
**Host:** Dr. [Guest Name], thank you for sharing your expertise with us today.
**Dr. [Guest Name]:** My pleasure.