The government has confirmed that 53.87% of state spending will directly benefit the public, amounting to IDR 2,070 trillion out of the total IDR 3,842.7 trillion.

According to Febrio Nathan Kacaribu, Director General of Economic and Fiscal Strategy at the Ministry of Finance, this direct benefit consists of allocations within the central government’s budget as well as transfers to regional governments.

Of the central government’s spending allocation for 2026, which stands at IDR 3,149.7 trillion, around IDR 1,377 trillion will reach the public through various priority programs, while IDR 693 trillion will come from regional transfers.

“So we have IDR 693 trillion, plus IDR 1,377 trillion that will directly benefit society. This shows that the state and regional budgets function as a single framework for implementing both central and regional government programs,” Febrio explained at the Parliament Complex in Jakarta, Thursday (Sept 18, 2025).

He emphasized that with such a large allocation, the government aims to ensure faster economic growth that people can immediately feel.

For that reason, the government has widened the 2026 state budget deficit target from IDR 638.8 trillion (2.48% of GDP) to IDR 689.1 trillion (2.68% of GDP).

This increase was driven by higher spending targets, which rose from IDR 3,786.5 trillion to IDR 3,842.7 trillion, while state revenue targets edged up only slightly from IDR 3,147.7 trillion to IDR 3,153.6 trillion.

Nevertheless, Febrio pointed out that the 2026 deficit remains lower than the projected 2025 deficit, which is estimated at 2.78% of GDP or IDR 662 trillion.

“This actually reflects the government’s prudence in managing fiscal conditions, while still prioritizing economic growth through both central and regional spending,” he stressed.

Previously, Bank Mandiri’s economics team had also forecasted that at least IDR 1,377 trillion in the 2026 budget would directly benefit the public.

“The state budget will continue to support the economy, particularly from the perspective of consumption and investment,” stated Dian Ayu Yustina, Head of Macroeconomic and Financial Market Research at Bank Mandiri, during the Mandiri Macro and Market Brief 3Q25 Indonesia Economic Outlook event, Thursday (Aug 28, 2025).

Bank Mandiri economists noted that this public-oriented spending would be distributed across 18 priority government programs:

1. Energy Subsidies & Compensation – IDR 381 trillion (10.1%)

2. Free Nutritious Meals Program – IDR 335 trillion (8.8%)

3. Non-Energy Subsidies (KUR & Fertilizer) – IDR 109 trillion (2.9%)

4. Education Assistance (PIP/KIP scholarships, etc.) – IDR 89 trillion (2.3%)

5. Merah Putih Village Cooperatives – IDR 83 trillion (2.2%)

6. Health Insurance Contribution Aid – IDR 69 trillion (1.8%)

7. TPG/TPD for Non-Civil Servants – IDR 64 trillion (1.7%)

8. Housing Programs – IDR 49 trillion (1.3%)

9. Food Assistance Card (BPNT) – IDR 44 trillion (1.2%)

10. Family Hope Program (PKH) – IDR 29 trillion (0.8%)

11. Bulog & Food Reserves – IDR 29 trillion (0.8%)

12. Public Schools & Garuda Elite Schools – IDR 28 trillion (0.7%)

13. Road & Bridge Maintenance – IDR 25 trillion (0.7%)

14. School Renovation/Rehabilitation – IDR 23 trillion (0.6%)

15. Food Barns – IDR 22 trillion (0.6%)

16. Dams & Irrigation Development – IDR 12 trillion (0.3%)

17. Free Health Checks & Hospital Revitalization – IDR 7 trillion (0.2%)

18. National Fishermen’s Villages & Salt Programs – IDR 7 trillion (0.2%)