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Analysis: BOS fund suggested to finance Prabowo's free lunch program

Jakarta Post - March 13, 2024

Tenggara Strategics, Jakarta – The school operational assistance (BOS) fund has been put forth as a possible financing source for Prabowo Subianto's free school lunch program, the presumptive winner's key campaign promise. However, the proposal has met with stiff opposition, particularly from teachers' associations that believe using the fund will hinder further improvements to teachers' welfare and the quality of Indonesia's education.

The suggestion was first made by Coordinating Economic Minister Airlangga Hartarto, who said the relatively structured administrative and funding systems at elementary and junior high schools were suited to disbursing the BOS fund specifically for the free lunch program. Airlangga did not, however, supply any details on how this could be implemented, including what proportion of the BOS fund should be earmarked for this purpose.

Following his suggestion, Airlangga's expert staffer Ahmad Zeki Iskandar explained that the BOS fund was divided into two parts: a regular fund and an affirmation fund. The regular BOS fund is intended to support school operations, such as facilities maintenance, the provision of multimedia learning tools and the wages of contract teachers, while the affirmation BOS fund is allocated for schools in poor and disadvantaged areas as determined by the Education, Culture, Research and Technology Ministry. Ahmad Zeki suggested that the affirmation fund could be used for the free lunch program to ensure "clear and more organized" monitoring of budgeting and allocation.

The suggestion to use the BOS fund for the free lunch program was immediately met with opposition from teachers' associations, particularly the Federation of Indonesian Teachers Associations (FSGI) and the Education and Teachers Association (P2G). They argued that the affirmation BOS fund was not sufficient to finance the program, the budget of which was reportedly estimated at around Rp 400 trillion (US$25.4 billion). They pointed out that the total BOS fund allocated in this year's state budget was only Rp 52.08 trillion (US$3.3 billion), 2.3 percent lower than last year's allocation of Rp 53.3 trillion.

Moreover, they expressed strong concern that the quality of education would decline if the BOS fund was used to finance the free lunch program, regardless of the money came from the regular or affirmation BOS fund, since it would cut into schools' operational needs and leave them struggling to pay contract teachers and utility bills. The BOS fund is part of the larger Educational Unit Operational Assistance (BOSP), which aims to support the country's 12-year compulsory education.

Just last month, reports circulated that Prabowo planned to address the challenge of funding the free lunch program by reducing government spending on energy subsidies, pointing out that the subsidies' distribution was often misdirected. He also laid out other options, such as increasing the tax ratio and pushing economic growth through industrialization, though experts on his team were still calculating these alternatives.

What's More

Following criticism over the suggested use of the BOS fund to finance Prabowo's free lunch program, Ahmad Zeki said the government had no intention of reducing the education budget for this purpose and would instead increase it. He added that the government was currently conducting a comprehensive study and exploring various financing possibilities for the program.

The free school lunch program was recently piloted at a junior high school in Tangerang regency, Banten. Initiated and funded by the regional government, the pilot aimed to identify any potential pitfalls that could arise if the program was implemented at state-run schools nationwide. The pilot program served up to four main dishes, including chicken rice, egg rice, siomay (steamed dumplings) and gado-gado (vegetable salad with peanut sauce). Prabowo had set the cost at Rp 15,000 (95 US cents) per portion, which was criticized by some business owners who said it was not enough to ensure the nutritional value of the food.

Airlangga said the free lunch pilot could be expanded to other areas, which would help the government identify potential issues, such as diverse school environments,, infrastructure, funding and cooperation mechanisms between schools and food vendors, mostly small and medium enterprises (SMEs). He said an expanded pilot would also help the government assess the program's multiplier effect for drafting a free lunch policy.

What we've heard

Several sources within the government have stated that several ministries have been asked by President Joko Widodo to review the free lunches and milk policies, the flagship policy of the Prabowo-Gibran pair, even though Prabowo Subianto and Gibran Rakabuming Raka have not yet been officially inaugurated as president and vice president.

Some of the institutions and ministries asked by Jokowi to review the policy was the Bappenas and the Ministry of Villages, Disadvantaged Regions and Transmigration. While these two institutions perform reviewing duties, economic affairs coordinating minister Airlangga Hartarto mentioned that the free lunch and milk policies would be funded by the BOS budget. However, the two ministries tasked with making the review are unaware of the plan to reallocate part of the BOS budget for free lunches and milk.

Another source mentioned that Airlangga's heavy involvement in the free lunches and milk policy is an effort to avoid being ousted from his position as chairman of the Golkar Party. Especially in recent weeks, there have been rumors circulating that the Chairman of the Golkar Party is being targeted by many people – including some in the Presidential Palace.

Airlangga's proposal differs from the study at Bappenas, which sees the policy as originating from the restructuring of energy subsidies that are gradually being reduced – in line with the government's plan to reduce energy subsidies. An alternatives option is to reallocate from unproductive budgets. For example, the Villages Ministry could establish village kitchens for free lunches in underdeveloped, frontier, and outermost (3T) regions.

[This content is provided by Tenggara Strategics in collaboration with The Jakarta Post to serve the latest comprehensive and reliable analysis on Indonesia's political and business landscape.]

Source: https://www.thejakartapost.com/opinion/2024/03/13/analysis-bos-fund-suggested-to-finance-prabowos-free-lunch-program.htm