Fuel oil price hike may save Rp40 trillion budget: Official

Jumat, 12 April 2013 | 09:28

Ministry of Finance has calculated that government may save Rp35 to Rp40 trillion of subsidy fund if it raises the fuel oil price to Rp1,500 per liter in May 2013."To raise the fuel oil price is the most significant option to alleviate subsidy," Finance Ministry`s Head of Fiscal Agency Interim Bambang Brodjonegoro said here on Thursday.

According to Brodjonegoro, the next option after the price hike is to limit or ban the use of subsidized fuel oil by the private cars, and the last option is to produce a new variant of premium gasoline which is numbered 90-octane.

He said the longer the government hesitates on the fuel oil policy, the less money can be saved, and it might cause the bigger of oil and gas trade`s deficit, and also curbed the rupiah`s currency.

Brodjonegoro added that the Finance Ministry only calculated its effects to the fiscal, growth, poverty, employment, and inflation.

"While, the leaders have to calculate its politically and socially impacts," he said.

He underlined that the more subsidies` funds can be saved, the bigger its compensation range.

Currently, the government is still discussing those three options related to the oil fuel policy in order to alleviate the ballooning subsidies` funds regarding the hike of global oil fuel price and consumption.(*)

source http://www.antaranews.com