Budget Realization in National Economic Recovery Program Reaches Rp383.01 T
Date 13 November 2020
As of the third quarter this year, budget realization of the National Economic Recovery (PEN) program has stood at Rp383.01 trillion or accounting for 55.1 percent from the allocated budget ceiling of Rp695.2 trillion, according to Finance Minister Sri Mulyani Indrawati.
“The PEN budget realization saw a tremendous acceleration in the third quarter and we will continue to monitor it in the fourth quarter,” Sri Mulyani said on the Working Meeting with Commission XI of the House of Representatives (DPR), Thursday (12/11).
The PEN program consists of various clusters, namely health, social protection, sectoral ministries/institutions, Micro, Small and Medium Enterprises (MSMEs), corporate financing, and business incentives.
In health cluster, the Ministry continued, the budget ceiling was adjusted to Rp97.26 trillion, which include the SiLPA earmark for vaccines of Rp29.23 trillion. “With the budget ceiling adjustment, the PEN budget realization in the health cluster reached Rp34.07 trillion or 35 percent,” she added.
Sri Mulyani further said that the health cluster program are being used for health workers, spending for the COVID-19 handling, COVID-19 handling task force, compensation for the death of medical workers, contribution assistance for the National Health Insurance (JKN), and incentives for health taxation.
In social protection cluster, budget realization reached 77.3 percent or Rp181.11 trillion from the adjusted budget ceiling of Rp234.33 trillion. This social protection cluster is intended for the Family Hope Program (10 million beneficiary families), the basic food cards (19.4 million beneficiary families), the additional social assistance (9 million beneficiary families), the basic food social assistance (nearly 2 million beneficiary families in Greater Jakarta and 9.2 million in outside of Greater Jakarta), and the Village Fund Direct Cash Assistance.
“As for electricity subsidies, 900 Watt users get a 50 percent tariff discount and 450 Watt users are free of charge. It means 80 percent of families in the country receive electricity subsidies from the Government,” the Minister said, adding that the Government also provides wage subsidies for 12.4 million active members of the Workers Social Security Agency (BPJS Ketenagakerjaan) and for 2.4 million honorary teachers under Ministry of Education and Culture as well as Ministry of Religious Affairs.
The social protection cluster budget is also provided to support distance learning for all students and college students, teachers, and lecturers as well as to improve job seekers’ access to labor market or become entrepreneurs.
In sectoral ministries/institutions cluster, budget realization reached Rp32.47 trillion or 49.2 percent of Rp65.97 trillion. Funds from the cluster are allocated to labor-intensive programs (2.18 million worker beneficiaries), housing incentives, tourism stimulus, food estate program readiness and environmental restoration, the Physical Special Allocation Fund (DAK), and other assistance for emergencies.
In business incentive cluster, budget realization reached Rp38.13 trillion or 31.6 percent of Rp120.6 trillion. A total of 211,476 companies other than MSMEs taxpayers have made the most of the program. “The applicants are dominated by companies from trade, manufacturing, construction and real estate, to services sectors which have been hit hard by COVID-19,” Sri Mulyani added.
In MSMEs cluster, budget realization reached 83 percent or Rp95.25 trillion from the adjusted budget ceiling of Rp114.81 trillion. Furthermore, investment financing through the Revolving Fund Management Agency (LPDB) has been fully implemented.
In corporate financing cluster, budget realization reached Rp2.001 trillion or 3.2 percent from the adjusted budget ceiling of Rp62.22 trillion. The funds are allocated to corporate underwriting of Rp945 million and loss limit claim of Rp2 trillion.
“We are currently facing a situation that the banks have to do a debt restructuring so it will require extra effort to provide loans,” the Minister said, adding that borrower companies are also in difficult situation due to bad debt. (Ministry of Finance PR /UN)
Translated by: Galuh Wicaksono
Reviewed by: Muhardi