Jakarta. President Prabowo Subianto has called for sweeping reforms in Indonesia’s state-owned enterprises (SOEs), slamming bloated boards of commissioners and lavish annual bonuses paid even to loss-making companies.

Speaking during his inaugural 2026 state budget address at the House of Representatives on Friday, Prabowo said the newly established sovereign wealth fund Danantara has been tasked with cleaning up the operations of SOEs to maximize returns for the nation.

“Our SOEs, if combined, have assets worth trillions of US dollars,” Prabowo said. “They should be contributing at least $50 billion a year to the state budget. That would make our budget deficit disappear.”

One of his first targets is the size of SOE boards of commissioners, which he said in some cases had grown unnecessarily large despite the companies posting losses. “I’ve cut the number of commissioners by half. Six members at most is enough,” Prabowo said.

The president also took aim at tantiem—annual performance bonuses for directors and commissioners—saying he had learned of cases where individual commissioners in struggling SOEs received up to Rp 40 billion ($2.6 million) a year.

“How can a commissioner attend one meeting a month and still get a Rp 40 billion bonus while the company is losing money? I have ordered Danantara: no bonuses if the company is in the red,” Prabowo said.

The president made clear that efficiency drives now apply not only to ministries and government agencies but also to state enterprises. Executives unwilling to accept the changes, he said, should step aside. “If directors or commissioners refuse to work without these bonuses, they can resign. There are plenty of young, capable Indonesians ready to replace them.”

The government sees Danantara as a strategic vehicle to boost SOE performance, add value to natural resources, and create jobs. It is also intended to ensure that the nation’s wealth benefits the people directly.

In 2024, SOEs delivered Rp 86.4 trillion ($5.3 billion) in dividends to the state, exceeding the target of Rp 85.8 trillion set by the Finance Ministry and the SOE Ministry. Prabowo wants this figure to grow significantly, aligning with his broader fiscal goal of balancing the budget by 2028.

“Danantara is a milestone in our journey toward economic independence, resilience, and national prosperity,” Prabowo said, adding that strong financial discipline and responsible governance will be central to the reform agenda.

Parliament will now deliberate on the 2026 budget, which includes measures to shrink the fiscal deficit while increasing investment in energy, food security, and human capital development.