Bogor. President Prabowo Subianto announced that Indonesia’s budget efficiency measures will continue in three phases, targeting total savings of Rp 750 trillion (approximately $44 billion). Speaking at the 17th anniversary celebration of the Gerindra Party at Sentul International Convention Center (SICC) on Saturday, Prabowo outlined the government’s fiscal strategy.

“In the first phase, the Finance Ministry successfully saved government spending by Rp 300 trillion. The second phase aims for another Rp 308 trillion in savings,” Prabowo said.

However, Rp 58 trillion from the second phase will be reallocated to ministries and government agencies, effectively reducing the net savings to Rp 250 trillion.

By 2025, state-owned enterprises (SOEs) are expected to generate Rp 300 trillion in dividends, with the government utilizing Rp 200 trillion. “In total, we will have Rp 750 trillion,” Prabowo added.

A portion of the savings will fund the Free Nutritious Meals (MBG) program, which has an estimated budget of Rp 375 trillion (around $24 billion) through the end of his administration. Prabowo emphasized that addressing child nutrition remains a priority.

Additionally, the government plans to channel the remaining Rp 375 trillion, or approximately $20 billion, funds into Danantara, the state-owned investment superholding set to launch on Feb. 24. Reports showed that Danantara would manage assets of SOEs, including banks Mandiri and BNI, state utility PLN, oil and gas company Pertamina, mining giant MIND ID, and telecommunications company Telkom. 

Finance Minister Sri Mulyani Indrawati recently reaffirmed that Indonesia’s 2026 state budget will continue the cost-cutting measures implemented in 2025. The current budget has already been trimmed by Rp 306.69 trillion, affecting ministry allocations and regional transfers.

While maintaining fiscal discipline, Sri Mulyani assured that public services and social spending, including social assistance programs, will remain protected. The Finance Ministry will conduct a comprehensive review of all government agencies to ensure compliance with efficiency measures while upholding constitutional obligations.

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