Some Doubts As Govt Says It Will Expand Fuel Saving Plan to Bali

By webadmin on 10:06 pm Jun 12, 2012
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Tito Summa Siahaan & Retno Ayuningtyas

Analysts have voiced concerns about the government’s latest plan to curb the use of subsidized fuel, saying they doubted the sticker distribution scheme that would identify state vehicles as ineligible to buy subsidized fuel at gas stations.

Their comments came as the government announced it would extend the program, already in effect in Greater Jakarta, to the rest of Java and Bali.

Energy Minister Jero Wacik introduced the regulation for Greater Jakarta last month, saying it would help save Rp 5 trillion ($535 million) in subsidy spending.

Nurul Handayani, a 27-year-old teacher, said he wasn’t sure fuel station workers would enforce the scheme or that officials would obey it.

Kurtubi, a director at the Center for Petroleum and Energy Economic Studies, also questioned the plan.

“The mechanism for its implementation and monitoring was vague and unclear,” he said.

“It is impossible to hand over the task of monitoring to workers at gas stations, and placing our police officers to man gas stations across Java and Bali would be too expensive.”

Ahmad Erani Yustika, the director of the Institute for Development for Economics (Indef), echoed Kurtubi’s comment.

“So far, the issue of smuggling is not addressed and the government seems powerless in handling it,” he added.

The stickers will be placed on 90,000 official vehicles in Java and Bali. There are currently 60,000 such vehicles in Greater Jakarta.

Its implementation has already started for government officials in Greater Jakarta and will begin as of Aug. 1 for civil servants in the rest of Java and Bali.

The government has allocated Rp 137.3 trillion for fuel subsidies and Rp 64.9 trillion for electricity subsidies in the revised 2012 state budget.