The Energy and Mineral Resources Ministry has signed a memorandum of understanding with Bank Indonesia (BI) to expedite the integration of energy subsidies that will be channeled through the Prosperous Family Card (KKS).
The KKS, which is expected to promote non-cash social assistance with proper distribution, will be linked to an integrated system connecting various state-owned lenders under the Association of State-Owned Banks (Himbara).
Energy and Mineral Resources Minister Ignasius Jonan said it was difficult to monitor the distribution of subsidized 3-kilogram liquefied petroleum gas (LPG) canisters on the field as such canisters were often purchased by ineligible customers.
“Hence, the subsidy for the 3-kg LPG canisters will no longer be given to [state-owned energy firm] Pertamina. Instead, it will be distributed directly to those really needing it through the KKS,” Jonan said in Jakarta on Thursday.
Jonan expects the implementation of the new subsidy scheme for the 3-kg LPG canisters and electricity to begin in January 2018, or in March at the latest. “However, we might need to wait for the full implementation of the single identification number system before we can impose a similar scheme for kerosene and biosolar,” Jonan said.
Data from the National Team for the Acceleration of Poverty Alleviation (TNP2K) show that there are only 25.7 million households eligible to purchase Pertamina’s subsidized 3-kg LPG canisters. However, the canisters have been distributed to almost 60 million households. (Viriya P. Singgih)
Editor: Mesti Sinaga