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The House of Representative and the government agreed
Wednesday on revisions to the 2006 state budget, putting the deficit at
Rp 36.9 trillion (US$4 billion), or 1.2 percent of gross domestic
product, and lowering projected economic growth to 5.8 percent.
Other revisions include a higher fuel subsidy allocation of Rp 64.2
trillion and power subsidy allocation of Rp 31.2 trillion. They also
agreed to provide Rp 2.2 trillion for 15 troubled state companies.
The revisions are scheduled to be endorsed at the House's next plenary
session later this month.
This year's revised budget deficit is 64 percent higher than its
initial figure of Rp 22.4 trillion, or 0.9 percent of the GDP. The
higher deficit comes from state expenditures that are 7 percent higher
than initially projected at Rp 695.9 trillion. This exceeds the 5
percent increase in projected state revenue at Rp 658.8 trillion, said
Bachrudin Nasori of the House budget committee.
Total central government expenditures have also been raised 11 percent
to Rp 474.9 trillion, while allocation for the regions is at Rp 220.8
trillion.
Central government spending will include Rp 68.5 trillion for capital
goods and Rp 56.1 trillion for durable goods.
It was also agreed that the state budget would provide funds in the
form of "state investments" in several financially troubled state
firms, including the country's flagship carrier PT Garuda Indonesia and
airliner PT Merpati Nusantara.
Garuda will receive Rp 1 trillion, half of it immediately and the other
half next year after all the questions over its liabilities and related
asset ownership transfer have been resolved. Merpati will immediately
receive Rp 450 billion.
Other state firms to receive money include Aceh fertilizer producer
Pupuk Iskandar Muda (Rp 150 billion) and pulp company Kertas Kraft Aceh
(Rp 300 billion), as well as Bandung-based aircraft manufacturer PT
Dirgantara Indonesia and Jakarta bus company Perum PPD (both Rp 40
billion).
Remaining items to be discussed by the budget committee and the
government include details of last year's power subsidy payments and
reconstruction funds for the tsunami-stricken Aceh and Nias.
Finance Minister Sri Mulyani also wants to discuss with the House
providing up to Rp 355 billion to fund Indonesian troops taking part in
the United Nations peacekeeping mission in Lebanon.
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