Govt finally raises fuel prices on Saturday

The government has finally decided to rasie fuel prices by an average 30.1 percent on Saturday despite the public's protests.

Coordinating Minister for the Economy Burhanuddin Abdullah told repoters Friday evening the policy was necessary to reduce the country's ballooning budget deficit, caused among others by fuel subsidy.

The government has initially earmarked Rp 53.8 trillion (US$=Rp 11,247) for fuel subsidies this year, but the subsidy was projected to increase to Rp 60 tillion without the 30.1 percent increase, Burhanuddin said.

In order to protect the poor, who rely on kerosene for cooking, against the impact of the fue price increases, Burhanuddin said, the government would allocate Rp 2.2 trilion in funds to promote their health and education.

Under the new pricing scheme, the price for one liter of the Premium gasoline will rise from Rp 1,150 to Rp 1,450, kerosene from Rp 350 to Rp 400, diesel oil from Rp 600 to Rp 900.

The government initially planned to raise the fuel prices on Friday but it was delayed for unclear reasons.

(Bodega)