Ulma Haryanto & Dessy Sagita, Jakarta – A government plan to revoke the state subsidy on three-kilogram gas cylinders came under criticism from consumers on Wednesday, with some accusing the authorities of cheating the public.
"It's like the government has just cheated the people. They told us to move from kerosene to [liquefied petroleum gas], and now they are going to raise prices," Daryatmo from the Indonesian Consumer Protection Foundation (YLKI) told the Jakarta Globe.
Coordinating Minister for People's Welfare Agung Laksono said on Tuesday that the government was considering increasing the price for subsidized three-kg cylinders by Rp 4,000 to Rp 5,600 (45 cents to 63 cents). The final decision on the proposed price hike will be made today.
The price disparity between the three-kilogram cylinders and the non-subsidized 12-kilogram cylinders has led crooked traders to siphon the gas from the smaller containers to fill the larger ones.
The siphoning is done with needles and syringes, which damages the canisters' valves. The damaged valves have been blamed for the ongoing spate of explosions that have killed dozens.
President Susilo Bambang Yudhoyono has ordered his ministers to look into the problem and the price disparity between the cylinders, which are being distributed under a government program to encourage low-income households to switch from kerosene to cheaper LPG.
Furthermore, Daryatmo also viewed the move as an attempt to "stir-up people's emotions." He said that the government had already come out with plans for a closed distribution system in which the sale and refilling of the canisters would only be in the hands of state oil and gas company Pertamina. "So they better apply it properly first," he added.
Bachrowi from the Indonesian Community Association of Gas Consumers (Himkogasi), called the plan to raise gas prices "totally ridiculous," and said the move would not solve the problems.
"It's really unfair, the plan does not make any sense, especially for the poor people who are already struggling to make ends meet," he told the Globe.
He also said that the government has not properly compensated the victims of gas explosions. "It is very ironic because the problem we are facing right now is still very far from a solution, why create another problem?"
Bachrowi said that the price hike could not guarantee an improvement in the quality of the gas cylinders. He added that the proposed price hike was ill-timed since millions of Indonesians were already facing increased prices for other necessities.
"It's Ramadan already, all the prices went up like crazy," he said. "Why would we need to add to the burden?"
Bachrowi said that the government should study the conversion program to find out what went wrong. "If they conducted a thorough audit, I'm sure they will find many violations, and we will be able to find out who has been benefiting from the whole gas cylinder tragedy."
Agung and Pertamina president director Karen Agustiawan have promised that to offset the effect of the price hikes on the poor, with the government doling out direct cash subsidies or issuing vouchers to purchase gas.
But even this plan could pose problems. Amy Yayuk Sri Rahayu, a public service analyst from the University of Indonesia, said a voucher system or cash subsidies would be susceptible to fraud, and should be tested first in pilot projects in several urban wards.