2018 Subsidy Spending Realization Reaches Rp 217 Trillion, Swelling 39% Above the State Budget Allocation

In the 2018 Central Government Financial Report (LKPP), realized subsidy spending reached Rp 216.88 trillion, a 38.82% increase from the Rp 156.23 trillion budgeted in the 2018 State Budget (APBN). This subsidy spending also increased by 30.42% compared to the 2017 realization of Rp 166.4 trillion. These three types of subsidy spending account for approximately 70% of the total.

The largest subsidy spending in 2018 was for LPG subsidies, reaching Rp 58.14 trillion (a 50% increase from the previous year). This was followed by electricity subsidies at Rp 56.5 trillion (up 11.69%) and diesel fuel subsidies at Rp 35.5 trillion (up 440%).

(Read databoks: How Much is the Government's Budget for Subsidies in 2019?)

The increase in LPG subsidies was due to rising prices and increased distribution volume to the public. Meanwhile, the increase in diesel fuel subsidies resulted from the government's policy of adjusting fixed diesel subsidies to absorb the risk of price increases that could reduce public purchasing power and to control inflation.

(Read Databoks: Where are Energy Subsidies Redirected?)