President Jokowi Calls on Regional Governments to Control Inflation

President Jokowi. (Photo by: PR of Cabinet Secretariat/Teguh)

President Joko “Jokowi” Widodo called on the regional government officials to speed up budget realization of general allocation fund (DAU) and unexpected funds to control inflation at regions.

He affirmed that the use of the budget for inflation mitigation has been regulated under a legal umbrella.

“Don’t hesitate to use the unexpected funds and general allocation fund because a Regulation of Finance Minister and Circular of Minister of Home Affairs have been issued to regulate it.  I have already told the Attorney General office, KPK [Corruption Eradication Commission] about this issue given the urgency,” he said in his directives to ministers, heads of institutions, regional heads, directors of State-owned Enterprises, Commanders of Regional Military Command, Regional Police Chiefs (Kapolda), and High Prosecutor’s Office Heads (Kajati), at the Jakarta Convention Center, Jakarta, Thursday (09/30).

Previously, the President has also ordered regional heads to allocate two percent of the DAU and Revenue Sharing Funds (DBH) to mitigate potential rising costs in regions in the form of transportation subsidy for food products and social assistance.

Through this scheme, an increase in food prices can be reduced by using the funds to subsidize logistics costs. The Government can buy egg from producers in Bogor, Blitar or Purwodadi. The egg will then be transported to each region and the transportation cost is borne by regional budgets.

In addition, President Jokowi also invited all sides to unite in addressing inflation issue since it threatens all countries.

In other countries, addressing inflation is the duty of the Central Bank, whereas in Indonesia it is common responsibility. He also expressed his appreciation to Bank Indonesia and Minister of Finance for carrying out their tasks in unison.

“It is more important to solve the root cause than hold money in circulation. [addressing] rising prices of goods and service is our common responsibility,” he said.

In the meantime, Governor of Central Java Ganjar Pranowo confirmed that he already has three scenarios to control inflation, among others market operation, transportation subsidy, and price subsidy.

“We still need to monitor the measure so that the transportation subsidy will immediately lower the price [of commodities] at markets,” he said adding that the regional government will also cooperate with regional-owned enterprises (BUMD) to provide price subsidy. (MAY/UN) (RAS/MMB)