Gov’t to Increase State Budget Allocation in Health, Social Affairs Sectors

Minister of Finance delivers a press statement after a plenary cabinet meeting, Monday (5/7). (Source: Presidential Secretariat YouTube)

The Indonesian Government has decided to refocus the State Budget to support COVID-19 handling and social protection programs.

“Due to current measures and changes, especially on the spike of COVID-19 (cases) which leads to the implementation of emergency PPKM (public activity restriction), the State Budget needs to increase its support for programs in the health and social protection sectors,” Minister of Finance Sri Mulyani said after a plenary cabinet meeting, Monday (5/7).

The Minister stated that the budget ceiling for the health sector in 2021 will be increased to Rp193.93 trillion. “This is an increase from what we said yesterday at Rp172 trillion, and it has increased again to Rp182 trillion, and now it has increased to Rp193 trillion. So, there is a very high increase in the health sector,” she explained.

The budget ceiling, among others, is used for testing and tracing, patient care, incentives for medical personnel, death benefits for medical personnel, procurement of medicines and personal protective equipment (PPE), procurement of 53.91 million doses of vaccine; contribution assistance for national health insurance (JKN) for 19.15 million people; and health tax incentives including VAT and import duties on vaccines.

On social protection programs, efforts are made to accelerate the disbursement of funds. “Earlier, the President ordered us to accelerate the disbursement of funds this week, especially for the Hope Family Program to be disbursed earlier, the fund for the third quarter can be paid in July, so that it will help the people,” she said.

The realization for the Family Hope Program in the second quarter was Rp13.96 trillion for 9.9 million beneficiaries, while the budget allocation for 2021 was Rp28.31 trillion for 10 million beneficiaries. “We hope that the target of 10 million beneficiaries can be achieved,” the Minister said.

Then, for Staple Food Program, there will also be an acceleration of distribution in early July and the fulfillment of the target of up to 18.8 million beneficiaries with a total budget allocation of Rp40.19 trillion. Until the second quarter, the realization of this program reached Rp17.75 trillion for 15.9 million beneficiaries. “We hope that it will be disbursed in early July as well. Earlier, the President even asked for this week, this directive is now being carried out by Ministry of Social Affairs,” she said.

Furthermore, Social Cash Assistance (BST) for 10 million beneficiaries for two months will also be disbursed this July. Realization of the budget until the second quarter is as much as Rp11.9 trillion for 10 million beneficiaries. “Two months’ worth of Social Cash Assistance will be disbursed for 10 million beneficiaries, so, we will need Rp6.1 trillion,” the Minister said.

Then, for village funds direct cash assistance (BLT Desa), there will be an acceleration of distribution through the redesign of the BLT Desa policy. The 2021 budget allocation for this program is Rp28.8 trillion for 8 million beneficiaries, while the realization for the second quarter was Rp4.99 trillion for 5 million beneficiaries. “This can also be accelerated in July,” she stated.

The Pre-Employment Program for 2.8 million participants will also be executed in July-August which requires an additional budget of Rp10 trillion. Previously, until the second quarter, a budget of Rp10 trillion has been realized for 2.8 million participants. “The Pre-Employment Card for the second batch of the absorption can be implemented in July,” she said.

Furthermore, the Government also provided Internet Data Assistance for 27.67 million students, university students, and teaching staff (teachers and lecturers).

In addition to social assistance programs, in supporting the implementation of Emergency PPKM, an additional budget is also needed for other protection programs.

The first is for the extension of the Electricity Discount. “The electricity discount to 32.6 million customers will be extended from six months to nine months, meaning until September. For that reason, we will need an additional allocation of Rp1.91 trillion,” the Minister said.

Second, Minimum Electricity Bill Assistance, Electricity Subscription Fees will also be extended until September, so it will require an additional Rp420 billion. Third, Productive Aid for Micro Enterprises (BPUM) will be given to 3 million new recipients. “This will take place between July-September. The total allocation is Rp3.6 trillion,” she said.

Lastly, Business Incentives are given to support business actors, encourage public consumption, and increase the purchasing power of employees.

For the record, the refocusing will target expenditures such as honorarium expenditures, official trips, meeting packages, service expenditures, assistance to the community/regional government that is not part of the President’s directives, construction of office buildings, procurement of vehicles and equipment/machinery, remaining auction funds and/or self-management funds, budget from activities that have not been contracted or that are not possible to carry out, as well as activities that are not urgent/can be postponed/cancelled. (TGH/UN) (FI/LW)