Finance Minister Sri Mulyani Indrawati (wearing white). — The Jakarta Post
JAKARTA: A shortened chain of command in the Cabinet is seen to indicate a more hands-on approach to budget management by the new president.
Instead of being placed under the command of the coordinating economic minister, the finance minister now reports directly to the head of state.
President Prabowo Subianto inked two presidential regulations on Monday that serve as the legal foundation for his Cabinet.
Unlike the usual arrangement, however, the list of institutions overseen by the Office of Coordinating Economic Minister does not include the Finance Ministry.
Coordinating Economic Minister Airlangga Hartarto told reporters on Tuesday that the Finance Ministry was now “directly” under the president, but he refused to elaborate why such an arrangement was put in place.
Finance Ministry spokesman Deni Surjantoro confirmed the structural change on Tuesday.
In the Cabinet’s maiden plenary meeting yesterday, Prabowo said Indonesian bureaucracy was “notoriously complicated [and] very notoriously slow”, and he repeatedly emphasised the importance of “efficiency” in his speech.
“It’s not that I want to meddle with the work of the ministries; no, I want to help.
“Where there’s a bottleneck, where there’s hardship, we deal with it immediately,” said Prabowo, a former general who until Sunday served as the defence minister.
On her way to Monday’s plenary meeting, Finance Minister Sri Mulyani Indrawati did not respond to The Jakarta Post’s question about the structural change and walked on without addressing any of the state palace correspondents.
Andry Satrio Nugroho, an economist at the Institute for Development of Economics and Finance, said the arrangement indicated that Prabowo would have a more “hands-on” approach to fiscal policy as compared to his predecessor, Joko “Jokowi” Widodo.
“We can see that the president wants full control of the budget, because the programmes he promised during the election campaign require big spending.
“Given the circumstances, the president seems to be uncompromising on the budget,” Andry told the Post yesterday.
Andry saw the change in a positive light, noting that the old arrangement translated to more bureaucracy and was prone to political compromise.
“The Finance Ministry is no longer, quote unquote, controlled by the interests of the superior coordinating ministry.
“This, in my opinion, will surely provide positive sentiment expected by the market,” said Andry.
Bank Permata chief economist Josua Pardede told the Post yesterday that a direct line to the government’s top executive might align fiscal policies and strategies better with the president’s overall economic agenda.
He also said the ministry “may have more influence over national policy”. — The Jakarta Post/ANN
