Public vehicles to get separate gas stations

Bagus BT Saragih and Ridwan Max Sijabat, The Jakarta Post, Jakarta | Headlines | Thu, April 18 2013, 10:16 AM

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Quota victims: Farmers hoping to buy diesel at a gas station in Madiun, East Java, on Wednesday, leave disappointed after being told the fuel they need for their tractors is not available. Diesel has become a scarce commodity in many cities over the past month after the government enforced regional quotas. (Antara/Siswowidodo)


The government will separate the sale of subsidized fuel for privately owned cars and those for public vehicles and motorbikes to ensure that the dual pricing policy is effectively implemented, a senior minister
has said.

Energy and Mineral Resources Minister Jero Wacik said on Wednesday that subsidized fuel for privately owned cars and that for public vehicles and motorbikes would be sold in different gas stations to ease technical problems and prevent misappropriation.

“We will decide which gas stations will sell Premium fuel for public vehicles and motorcycles,” Jero said at the State Palace after a Cabinet meeting on fuel subsidies.

The government has not made a final decision on the price of the subsidized fuel for privately owned cars but it will not be far from the Rp 6,500 (67 US cents) per liter announced by Coordinating Economic Minister Hatta Rajasa on Tuesday.

Hatta said that under the dual pricing system, public vehicles and motorbikes would buy subsidized fuel at the current price of Rp 4,500 per liter, while privately owned cars would pay the higher price of Rp 6,500.

Jero said there would be clear signs at every gas station indicating which kind of Premium was on sale.

Special gas stations for fishermen will also sell Premium at Rp 4,500 per liter.

Jero acknowledged the plan would still bring challenges and technical issues. “But the problems will be less than if we allowed each gas station to sell both kinds of Premium,” he said.

Hatta said the government had yet to decide which stations would be assigned to sell fuel for public vehicles and motorbikes. The minister, however, implied that most stations would sell higher-priced Premium.

“We will use Google Maps and a geographical information system for that purpose. One thing is for sure, there will be at least one gas station selling cheaper Premium along any route of public transportation,”
he said.

There are more than 5,000 gas stations across the nation.

“We will use Google to help people identify what kind of Premium a gas station is selling,” Hatta said.

Jero previously said that the dual price policy would save at least Rp 21 trillion (US$2.16 billion) by the end of this year, and that around 77 percent of the fuel subsidies — earmarked in the 2013 state budget at Rp 194 trillion — are enjoyed by the country’s upper middle class.

Also on Wednesday, some labor unions grouped under the Indonesian Workers Union Council (MPBI), threatened to hold a series of national strikes until May Day to oppose the government’s plan to raise the subsidized fuel price which they claim will certainly harm the livelihood of millions of low-income workers.

The MPBI said in a joint press conference that they were disappointed because the government had not provided any measures to prevent knock-on effects on the basic commodities when the price of subsidized fuel for private cars was raised.

“The government has failed to assure low-income workers that the subsidized fuel price rise will not be followed by soaring prices of basic commodities and rents in industrial areas,” Said Iqbal, the chairman of the Confederation of Indonesian Workers Union, said.

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