Indonesia doubles wage subsidies, cancels electricity discount in stimulus shake-up
Housing before the skyline of the Jakarta business district on May 9, 2025. PHOTO: AFP
In last-minute changes to a planned consumer stimulus package for June and July, the Indonesian government has canceled an electricity discount but doubled wage subsidies.
Finance Minister Sri Mulyani Indrawati revealed in a press conference on June 2 that the wage subsidies for low-income earners would double from Rp 150,000 (S$11.8) per month per individual to Rp 300,000.
Eligible beneciaries include around 17.3 million workers earning up to Rp 3.5 million a month and some 565,000 'honorary teachers', a term commonly used for honorarium-based contract teachers.
Ms Sri Mulyani explained that the subsidies would ultimately be nanced by BPJS Ketenagakerjaan but that the government would set aside Rp 10.72 trillion from the state coffers to 'temporarily' fund the program.
The wage subsidies are a part of a series of measures aimed at boosting to consumer spending.
When it was first announced last month, the packaged was to cover six areas, one being transportation discounts for trains, airplanes and ships, another area included discounts on road tolls for some 110 million eligible drivers.
Two more areas were social aid for 18.3 million beneciaries and a discount on work accident insurance for employees in labour-intensive industries.
When it was first announced last month, the packaged was to cover six areas, one being transportation discounts for trains, airplanes and ships, another area included discounts on road tolls for some 110 million eligible drivers.
Two more areas were social aid for 18.3 million beneciaries and a discount on work accident insurance for employees in labor-intensive industries.
The package originally also included a 50 per cent electricity discount for June and July, similar to what the government had granted in January and February.
However, following a meeting at the State Palace and prior to June 2's press conference, Ms Sri Mulyani announced that the discount was not doable.
'We have held a meeting with other ministers, and, for the implementation of the electricity discount, the budgeting process turned out to be a lot slower, so if we wanted it for June and July, we have determined that it could not be executed,' said Ms Sri Mulyani.
She explained the decision to double wage subsidies with the canceled electricity discount.
The Energy and Mineral Resources Ministry issued a press statement on June 2 saying it had not been involved in the formulation of the stimulus initiative helmed by Coordinating Economic Minister Airlangga Hartarto.
'(The ministry) was never part of a team or any forum that talked about the electricity discount for June and July 2025,' said the ministry's spokesperson Dwi Anggia in the statement.
Earlier, Energy and Mineral Resources Minister Bahlil Lahadalia said he was unaware of the initiative just days ahead of the implementation.
'I don't know whether there's already (a discussion) on the technical (level) or not; I don't know yet. One thing is for sure, I still haven't received the report until today,' Mr Bahlil said on May 26, or 10 days before the policy's planned implementation.
Such a policy should require 'communication' with the energy ministry and the Finance Ministry, Mr Bahlil said, adding that he could only formally instruct state-owned electricity company PLN to execute it after that.
Bahlil proceeded to verify the planned policy with PLN president director Darmawan Prasodjo, who happened to stand next to the minister.
'I'm sure PLN still hasn't received (any instruction). Have you received any letters from the energy ministry? You haven't, have you? Because, as far as I'm concerned, I must sign the letters and I haven't done that,' Mr Bahlil said to Darmawan. 'Not yet,' the PLN director briey replied.
In total, the consumer spending stimulus required some Rp 24.4 trillion, according to gures presented by Ms Sri Mulyani. THE JAKARTA POST/ASIA NEWS NETWORK
Join ST's Telegram channel and get the latest breaking news delivered to you.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
3 hours ago
- Straits Times
S'porean Harvard undergrads can take up places in 6 local unis if they choose to return
The Ministry of Education said that the autonomous universities are ready to support Singaporean students in Harvard if they wish to continue their studies back home. PHOTO: AFP S'porean Harvard undergrads can take up places in 6 local unis if they choose to return SINGAPORE - Singaporean students who are currently undergraduates at Harvard have been told that autonomous universities here can offer them placements if they wish to discontinue their studies in the US and return home, owing to recent developments. This was conveyed on May 30 by the Republic's ambassador to the US, Mr Lui Tuck Yew, in a virtual town hall with the affected students. In response to queries from The Straits Times, a Ministry of Education spokesperson said the Republic's autonomous universities 'stand ready to support Singaporean students in Harvard if they wish to continue their studies in Singapore'. The spokesperson added this was shared with affected students so that they can consider returning to Singapore as a possible option to continue their studies. The autonomous universities consist of the National University of Singapore, Nanyang Technological University, Singapore Management University, Singapore University of Social Sciences, the Singapore University of Technology and Design and Singapore Institute of Technology. There are currently 151 Singaporean students in Harvard, according to university statistics. Among them are 12 Public Service Commission scholarship holders. The studies of foreign students in Harvard have been thrown into limbo since US President Donald Trump's administration announced on May 22 that it had revoked Harvard's Student and Exchange Visitor Programme certification with immediate effect. As a result, the nearly 6,800 international students in the Ivy League college were given an ultimatum to either transfer to another institution, or face deportation. A federal judge later blocked the move, with the Trump administration rolling back its stance on May 29 and giving Harvard 30 days to submit evidence contesting the administration's plan to revoke the school's right to enrol international students. International students make up more than a quarter of Harvard's student body, but US President Donald Trump said the university should cap its international intake at 15 per cent. The Trump administration's targeting of Harvard is part of a wider crackdown on other universities over several allegations, including claims of anti-Semitism and anti-white bias, which have been used as leverage to pressure them into enacting policy changes. Then on June 4, Mr Trump kept up the pressure on the world's wealthiest university by signing a proclamation targeting foreign students in Harvard. Besides suspending the entry of foreign nationals looking to study or take part in exchange programmes at Harvard, the order also directed the Secretary of State to consider revoking existing student visas for current Harvard students who 'meet the proclamation's criteria'. It does not apply to foreign nationals attending other US universities through a student exchange programme and also exempts those whose entries are deemed to be in the US' interests. The Ministry of Foreign Affairs (MFA) had said on May 27 that it is monitoring the impact on the academic prospects of Singaporean students, with the Singapore Embassy in Washington DC engaging the US State Department and Department of Homeland Security. The ministry had also set up support structures for affected students, including a group communication channel hosted by MFA's Consular Department and the Singapore Global Network. ST has contacted the Singapore Embassy in Washington DC for more information. Since the crackdown on Harvard, the Trump administration has also taken greater steps to stymie the intake of international students into the US. In an internal cable that was reported by Politico on May 27, US Secretary of State Marco Rubio had directed all overseas missions to stop scheduling new appointments for student and exchange visa applicants. The State Department also plans to issue guidelines on 'expanded social media vetting', with only visa appointments that have already been scheduled slated to be honoured. The extent of the social media vetting, as well as a timeline for it to be rolled out, have not been disclosed yet. Additional reporting by Angelica Ang Join ST's WhatsApp Channel and get the latest news and must-reads.
Straits Times
5 hours ago
- Straits Times
Why Is India talking to the Taliban?
A Taliban security officer in Kabul on May 18, standing guard over sacks of food aid donated by the Indian government. PHOTO: AFP The sole checkpoint between India and Pakistan opened again late last week – for one particular, highly symbolic convoy. More than 150 trucks from Afghanistan, carrying dried fruit and nuts, were allowed into India. New Delhi had a point it wanted to make. The border was closed after the April 22 terrorist attack on tourists in Kashmir, as anger against Pakistan's military rulers built in India, concluding in days-long clashes between the two countries in May . But India's leaders wanted to make it clear that this anger did not extend to the army's former allies, the Taliban. Join ST's Telegram channel and get the latest breaking news delivered to you.
Straits Times
6 hours ago
- Straits Times
Vietnamese say no to more kids after two-child limit scrapped
The adjusted law may not bring in a baby boom, as living costs rise and societal values change. PHOTO ILLUSTRATION: PIXABAY Vietnamese say no to more kids after two-child limit scrapped HANOI - After Vietnam removed its two-child limit, pharmacy worker Nguyen Thi Nguyet Nga says she still has no plans to have more kids, since she barely has time to see her daughters, or the money to provide them a good life. The country's communist government on June 4 lifted a long-standing ban on families having more than two children, as it battles to reverse a declining birth rate and ease the burden of an ageing population. But rising living costs and changing societal values mean the adjusted law may not bring the baby boom the government hopes for. First introduced in 1988, the law has been loosely enforced in recent years, and despite its abolishment, the 31-year-old Nga said she worries about the costs of having a third child. It would mean seeing her two girls – aged seven and 12 – even less than she does, or skimping on their education, she told AFP. 'My parents-in-law really want us to have a boy... however, I will definitely not have more kids,' Ms Nga said. She earns around US$300 (S$385) a month working in a pharmacy in the main town of northern Tuyen Quang province, while her children live with their grandparents 40km away. 'I don't earn enough for the two girls to have a good life. I don't have a chance to live with them every day,' she said. 'Mostly we talk on video chat and only see them once or twice a month, so why would I have another child?' Vietnam has experienced historically low birth rates in the last three years, with the total fertility rate dropping to 1.91 children per woman in 2024, below replacement level. Although the trend is most pronounced in major cities, such as the capital Hanoi and Ho Chi Minh City, Ms Nga says she and her friends in the countryside feel no more inclined to have larger families. 'It's better to have two grow up well than having three or four kids who don't have a good education or good life,' she said. 'Time for myself' University student Nguyen Thi Kim Chi, 18, shared Ms Nga's scepticism about having a big family, explaining that in an increasingly developed Vietnam, young people believed there were more options than devoting themselves entirely to raising children. 'My plan is to get married and have children once I have a stable career and financial security,' said Ms Chi, who studies dance performance in Hanoi. 'I intend to have one or two kids because I want to balance work, childcare, and also have time to take care of myself.' As in many countries, the soaring cost of living has acted as a drag on birth rates in Vietnam. Housing, utilities, healthcare and education costs are rising across the country, and those living in cities in particular say salaries no longer meet their needs. The United Nations Population Fund said it welcomed the country's policy shift but warned that it needed to invest in policies that help people balance family and professional life, including expanding access to quality childcare, and promoting gender equality in the workplace. Ms Tran Thi Thu Trang, who had a third child unexpectedly and now has two boys and a girl under seven, admitted life got much more difficult after the birth of her youngest. As an office worker in the port city of Haiphong, the 30-year-old is lucky to be able to afford a nanny. But 'salaries need to rise, we need help with kids' tuition fees and more support on healthcare', she told AFP. Following the removal of the two-child limit, 'I think it will take five to 10 years (for people to change their views)', she added. 'But only if the government makes this a priority.' AFP Join ST's Telegram channel and get the latest breaking news delivered to you.
