Jakarta – The government will cut certain projects from the revised 2015 budget (APBN-P) as a result of slow disbursement, Vice President Jusuf Kalla has announced.

The government is facing a worrying financial situation, having disbursed only 62.9 percent of the 2015 APBN-P, and with tax revenue realization standing at 58.6 percent of the yearly target as of Oct. 31. The budget deficit is Rp 259.2 trillion, 16.5 percent higher than the Rp 222.5 trillion set in the budget.

"We will have to cut [some projects]. Let's see what happens," Kalla told journalists as quoted by news portal kompas.com on Monday.

Decline in state income, he said, would necessarily have an impact on state spending, with the government forced to slash a number of projects to prevent the deficit from widening further.

The government was looking for solutions to handle the deficit, he explained, refusing to be drawn on suggestions the government could choose to increase its debt to keep a lid on the deficit.

Meanwhile, Finance Minister Bambang Brodjonegoro remained optimistic that the budget deficit could be kept under control, below the threshold of 2.5 percent of gross domestic product (GDP).

According to Bambang, many avenues remain open to boosting government spending and tax realization; potential sums include Rp 30 trillion from adjustments to policy, Rp 10 trillion from minimum asset revaluation, Rp 5 trillion from tax collection and Rp 5 trillion from tax extensification, or earning tax money from a wider range of sources.

He added that the government was also preparing multilateral debt in order to cover the year-end budget deficit. (rin)

Source: http://www.thejakartapost.com/news/2015/11/10/projects-be-axed-amid-govt-financial-woes.html