Government, House agree to cut fuel subsidy
Monday, July 23 2007 - 01:31 AM WIB
The House of Representatives (DPR) and government consented to pare down allocation of fuel subsidy in the 2007 revised state budget from Rp 61.8 trillion to Rp 55 trillion, Kompas Daily reported on Monday.
Vice Chairman of the House’s Task Force for Budgetary Affairs Haliz Nawawi said in Jakarta on Sunday that the reduction would be realized by curbing the quota of subsidized fuel from 37.9 million kiloliters to 36.02 million kiloliters.
Premium will be reduced to 16.58 million kiloliters from 17 million kiloliters. Diesel oil will be cut to 9.86 million kiloliters from 10 million kiloliters.
Meanwhile, kerosene subsidized quota will increase to 9.52 million kiloliters from 8.9 million kiloliters.
“LPG and electricity subsidies also changed” he went on.
Earlier, The government plans to reduce the profit margin for the sales of subsidized fuel for next year to 13.5 percent from 14.1 percent at present in order to further cut the fuel subsidy spending.
Director General of Oil and Gas at the Ministry of Energy and Mineral Resources Luluk Sumiarso said that the government would cut the profit margin given to Pertamina, rather than to increase the prices, in order to cut fuel subsidy. (*)