GOVT TO PROVIDE RP144.4 TRILLION IN SUBSIDIES IN 2010

Jakarta, Aug 3 (ANTARA) - President Susilo Bambang Yudhoyono said the government will provide a subsidy in the 2010 state budget amounting to Rp144.4 trillion or 14.3 percent of the total.

"We need this subsidy because the state is obliged to protect the lowest segment of the society so as to alleviate their burden," the President said in his state-of-the-nation address on the 2010 Draft State Budget and Financial Note before an extraordinary plenary session of the House of Representatives (DPR) here on Monday.

He said the subsidy was allocated especially in the face of the present global economic crisis.

"We must put in order the basic subsidy policies with the purpose of ensuring the target and direction-oriented allocation in conformity with the situation of our nation," the president said.

The president said that in 2010 the government would still plan to allocate a budget for subsidy for fertilizer, seedlings and food.

With the subsidy, the government would distribute quality fertilizers and seedlings with affordable prices so that farmers would become more productive and their well-being improved, the head of state said.

He said the government would also provide low-price rice for under privileged people.

Yudhoyono said to support the empowerment of micro, small and medium enterprises as well cooperatives, the budget allocated for the subsidy for the interest of the program credit would be raised, whether the small-holder Business Credits (KUR) to assist micro, small and medium enterprises or subsidy for the of modest and healthy housing credit.

Besides putting into order the subsidy policy in general, the government will also make an initial design for a medium-term policy comprising (first) gradual transfer of price subsidy (fuel oil,electricity and and food), (second) limiting subsidy recipients only to targeted households, priority sectors and public service and (third) improving the targeted household database, particularly farmers, craftsmen and fishermen to prevent overlapping subsidy recipients.