Precise Strategy Needed to Tame Inflation

The increase in fuel prices is expected to erode economic growth this year by 0.28 percentage points to 4.89 percent. Efforts to reduce the impact of price increases are needed so that the burden on society is reduced.

KOMPAS/RONY ARIYANTO NUGROHO

An elderly man is accompanied and assisted by other residents when he wants to sit down while receiving social assistance money for the transfer of fuel subsidies (BBM) at the Pos Hall RW 01 Gambir Village, Gambir District, Central Jakarta, Friday (2/9/2022).

JAKARTA, KOMPAS — A number of regions have introduced various programs to cope with the impact of the rise in fuel prices on commodity prices. However, there are still a number of obstacles related to data validation of recipients of social assistance and the distribution of funds to those eligible.

The Pontianak city administration in West Kalimantan has established a price monitoring program in an effort to ensure prices remain under control following the increase in fuel prices. The inflation control team continues to monitor commodity price developments.

In addition, the local government has ensured the availability of basic necessities and their smooth distribution.

“The Pontianak city inflation control team is working hard to closely monitor the price developments. Don't let the price increase hurt the public. We are trying as optimally as possible so that there is no increase in inflation," the mayor of Pontianak, Edi Rusdi Kamtono, said on Tuesday (6/9/2022).

Also read:

> Transport Fare Hike is a Certainty

> Producers and Traders Trying to Cope with Fuel Price Increase

To overcome the spike in food commodity prices following the rise in fuel prices, the Regional Inflation Control Team of Malang city, East Java, will again open “cheap markets” in 63 locations across five subdistricts in the municipality until December 2022 so that people can buy basic commodities at lower prices.

"With the increase in prices of a number of commodities as the result of the increase in the fuel prices, , we will continue to carry out a market operation to sell commodities needed by the people," said the head the economy, infrastructure and natural resources section of the Malang city administration, Yayuk Hermiati.

Meanwhile, the Tangerang administration in Banten has offered free services to passengers using the Tangerang Ayo Bus (Tayo) and the Si Benteng City transportation services. The Tangerang City Transportation Service has temporarily removed the travel fare of Rp 2,000 per passenger both for Tayo and Si Benteng minibuses. The public transportation will be free until 5 Nov., 2022.

We have prepared personnel to oversee the distribution of BLTs in each district.

Several other regions are also still preparing cash transfers (BLTs) for residents who are entitled to social assistance.

However, there are still obstacles in the validation of the data of the recipients and the technical guidance for the cash distribution.

The Papua provincial government is updating the data of the recipients so that the cash aid will reach its targeted recipients. Some 50,000 underprivileged families will receive the assistance.

“Only residents who are included in the list of beneficiary families can receive BLTs. We have prepared personnel to oversee the distribution of BLTs in each district,” said the head of the office of social affairs, population, civil registry and protection of Papuan women and children, Ribka Haluk.

DOKUMENTASI SAFWAN RAHARUSUN UNTUK KOMPAS

Around 100 city transportation drivers hold a demonstration demanding an increase in public transport fares after the increase in fuel prices in Sorong City, West Papua, Sunday (4/9/2022).

The cash assistance in Bandung city, West Java, has not been distributed because the data of the recipients has not been updated. However, it can be ascertained that more than 60,000 residents will receive assistance.

"We will check and validate the data. We need to coordinate everything because the data is still changing,” said the head of the Bandung social services department, Soni Bakhtiyar.

Meanwhile, the South Sumatra provincial government has prepared Rp 182.9 billion for cash aid for 304,803 poor families in South Sumatra. The aid will be distributed this week at a number of payment points. It will be distributed in two stages over a period of four months.

In Lampung, the BLT cash aid will be given to 700,896 poor families. The distribution of the aid to remote areas is prioritized and is targeted to be completed in two weeks.

“Data for BLT recipients is still provisional. The central government is still updating the data on the Social Welfare Integrated Data system," said the head of the Lampung Social Affairs Office, Aswarodi.

Also read:

> Social Assistance should Reach Targeted Recipients

> Govt to Provide Social Assistance to Maintain Buying Power

Constraints on the data validation of the BLT recipients have also occured in Surakarta, Central Java. In fact, the BLTs in the city have not been distributed because there has been a change in the amount of the assistance.

In addition, data on beneficiary families has not yet been fully collected. The distribution of the cash aid will be carried out after all the data on the beneficiary families are updated

"Yes, it must be delayed. There has been a change [in the amount of funding] from the ministry. Some will receive Rp 500,000 and Rp 300,000. We don’t know why. It is the Social Affairs Ministry that is in charge," said the head of the Surakarta Post Office, Muhammad Syarkawi.

The same thing happened in Magelang city, Central Java. Although the amount of the BLT cash aid has been fixed, the aid cannot be distributed because the local government is still waiting for direction.

"We are waiting for information on the schedule for distributing BLT from the Social Affairs Ministry," said Magelang City secretary Joko Budiyono.

KOMPAS/REGINA RUKMORINI

A coordination meeting on the impact of rising fuel prices was held by the Magelang City Government, Wednesday (31/8/2022).

In an online discussion at the Merdeka Barat Forum on Tuesday, Social Affairs Minister Tri Rismaharini said that her ministry was still updating the Integrated Social Welfare Data (DTKS) to ensure that the distribution of social assistance, including BLTs reached the targeted recipients. The Social Affairs Ministry has removed 56 million names from the list of social assistance recipients after verification. Data updates are carried out every month to ensure the aid reaches the targeted recipients..

"Based on the results of the data updating as of 8 Aug., 2022, we have removed 56 million names. There was data duplication and unregistered residents. We have matched the data with the [population and civil registration office]," said Risma.

Local governments are involved in updating the data. The social affairs minister said the regional governments had removed 33.8 million recipients of social assistances and had proposed 16 million new names. Meanwhile, 3.5 million listed people were not eligible to receive social assistance. As of 8 Aug., 2022, there were 146.57 million recipients included in the DTKS data.

Inflation rises

From Jakarta, a study conducted by the economist team of state-owned Bank Mandiri entitled "Analysis of the Sectoral Impact of the Increase in Subsidized Fuel Prices" shows that the increase in fuel prices has the potential to increase inflation by 1.14 percent this year. The inflation will erode economic growth in 2022 by 0.28 percentage points.

The head of industry and regional research of Bank Mandiri, Dendi Ramdani, said on Tuesday that the increase in the prices of Pertalite and Solar diesel fuel would increase inflation by 0.97 percent and 0.17 percent, respectively. Thus, inflation at the end of the year was estimated to reach 5.89 percent.

Without an increase in fuel prices, this year's economic growth could reach 5.17 percent. With the increase in fuel prices, the national economy only grew 4.89 percent.

Dendi estimated that the inflation would erode economic growth in 2022 by 0.28 percentage points.

“Without an increase in fuel prices, this year's economic growth could reach 5.17 percent. With the increase in fuel prices, the national economy only grew 4.89 percent," he said.

The increase in fuel prices has begun to affect food prices at a number of traditional markets, partly due to the increase in transportation costs.

The average price of red chili and big red chili in a number of traditional markets in Jakarta rose by Rp 3,500 per kg and Rp 2,500 per kg, respectively. The price of fresh meat increased by Rp 1,000 per kg. (DIA/JAL/ESA/NCA/FLO/DKA/RTG/ERK/EGI/RAMCAS/VIO/DIM/SKA/HEN)