Jakarta – The government and Commission VII of the House of Representatives have agreed on a subsidised fuel volume allocation for 2025 of 19.41 million kiloliters (kl). This figure has decreased compared to the previous year’s allocation, which reached 19.58 million kl.
This decrease is part of the government’s efforts to improve the efficiency of subsidised fuel distribution, ensuring that subsidies are right on target and not misused by unauthorised groups.
Minister of Energy and Mineral Resources (MEMR), Bahlil Lahadalia, in a working meeting with Commission VII of the House of Representatives, explained that the allocation of subsidised fuel for 2025 includes 0.52 million kl of kerosene and 18.89 million kl of diesel oil.
“This decrease in allocation is expected to reduce the misuse of subsidies by unauthorized parties, such as using subsidised fuel by luxury vehicles. This subsidy must benefit those who need it,” Bahlil said in a written statement on Wednesday, August 28.
In addition to fuel, the government has allocated 8.2 million metric tons of 3-kg-canister LPG. This allocation aims to maintain the availability of subsidised LPG for low-income people.
During the discussion, the government also decided to maintain the diesel subsidy at Rp1,000 per litre in 2025. This policy was taken after considering the economic and social impacts that could be caused by an increase in fuel prices in the market.
Fuel, LPG, and electricity subsidies are also a focus in the 2025 budget allocation. The government allocated a budget of Rp90.22 trillion for electricity subsidies, an increase from Rp73.24 trillion in 2024. This increase is partly due to an estimated increase in electricity subsidy recipients, from 40.89 million customers in 2024 to 42.08 million in 2025.
Deputy Chairman of Commission VII of the House of Representatives, Maman Abdurrahman, said that the increase in the electricity subsidy budget must be accompanied by more accurate targeting. “Electricity subsidies must reach the people in need, especially in areas that have not been fully covered by adequate electricity infrastructure, such as in Eastern Indonesia and the interior of Kalimantan,” he said.
Maman also emphasised the importance of improving data on subsidy recipients so that fewer people receive the subsidy’s benefits. “We must ensure that the state budget is used effectively and on target,” he added.
With these measures, the government hopes to improve the efficiency and effectiveness of subsidy distribution and encourage wiser and more appropriate energy use in the community. (Hartatik)
