State Fiscals to Suffer from New Government Programs

The root problem of the fiscal pit the government is finding itself in lies in the new government’s plethora of planned expenditures.

Akbar Evandio & Tegar Arief Fadly

27 Feb 2024 - 19.49
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State Fiscals to Suffer from New Government Programs

Illustration - Candidates for the Presidency and Vice President of the Republic of Indonesia, as determined by the General Election Commission's (KPU) preliminary calculations Prabowo Subianto (left) and Gibran Rakabuming Raka during a meeting./Bisnis.

Bisnis, JAKARTA — President Joko “Jokowi” Widodo's administration is facing a daunting task with only seven months left. The current regime is demanded to craft a fiscal framework that must align with the ambitious spending of the new government for the 2025 fiscal year.

Amid the success in achieving fiscal consolidation after the disruptions caused by the COVID-19 pandemic, the government appears impulsive by indulging in spending that could dig a deeper fiscal deficit next year.

On Monday (2/26/2024), several ministers and the President discussed 2025 fiscal policies to lay the groundwork for the next government. Unfortunately, the fiscal deficit target is much wider than the initial planning prepared by the Finance Ministry’s Fiscal Policy Agency (BKF).

In the latest fiscal draft, the budget deficit range for next year is positioned at 2.13–2.45 percent of the gross domestic product (GDP).

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© Copyright 2024, Hak Cipta Dilindungi Undang - Undang.